Counter-fraud operations in Northumberland saves council £2.8m last year

A meeting of the local authority’s audit committee received the annual report of the corporate fraud team.

It revealed that efforts in 2018-19 resulted in gross savings of £2,798,318 (£2,610,707 net), with the majority relating to checks on Right to Buy applications.

A total of 93 applications were scrutinised through this initiative, leading to 43 being withdrawn and resulting in a total saving of £1,934,155 that would have been allowed as a discount to the property purchase price.

As the report further notes, the 43 properties also remain part of the council’s housing stock and continue to generate rental income.

Another five properties have been recovered due to the tenants being non-resident and the keys returned for them to be re-let. Under the national guidelines, the recovery of these homes is worth a minimum of £693,000 to the council.

Elsewhere, fraudulent overpayments of council tax support amounted to £44,252.70, with six cases resulting in further penalties to the value of £3,072.

Cases involving single person discounts have resulted in £24,271.46 of additional revenue being identified, while small business rate relief cases have discovered £7,219.92 of recoverable income for the council.

Housing benefit overpayments are the responsibility of the Department for Work and Pensions, but are often identified during council tax investigations. Overpayments during 2018-19 totalled £43,311.79.

In relation to internal fraud, there were 15 referrals in 2018-19, of which five were rejected and the majority of these passed to the relevant department’s management.

The report explains: ‘These referrals are usually low-level matters that do not warrant a full fraud investigation, for example, using a company vehicle for personal use, etc.’

Of the other 10, five were closed – no fraud, three were closed with sanction action taken (eg, cautions and overpayments repaid in full) and one theft case was successfully prosecuted.

The team still has four cases open from these and earlier referrals with three of them being considered for legal action; these involve allegations of theft, abuse of position and false representation.

From the closed cases, overpayments of £7,720.32 were identified and either have been or are being repaid.