Social housing fraud is the wickedest form of welfare fraud. There’s more than the financial dimension: there isn’t enough social housing available, so every fraudulent occupation lengthens waiting lists, and every detection gives a family or individual in temporary accommodation a better life.
The Audit Commission put the cost of social housing tenancy fraud to the taxpayer nationally at £1.8 billion in 2012. Councils recovered nearly 1,800 homes in 2011, with a total replacement value of nearly £264 million. But this barely scratches the surface of the problem.
Experian suggests that at least 160,000 social homes are unlawfully sublet in the UK, but we believe this is a very low estimate. A study of social housing fraud in Westminster reported a raid on one Paddington housing block that revealed 75% of housing benefit claimants were not living in their registered properties and were illegally subletting them for thousands of pounds a week. Another raid, on the luxury 600-flat Park West development on Edgware Road, found 61% of claimants were subletting their properties. The cost of social housing fraud in the City of Westminster alone may be as much as £22 million a year.
Freeing up sublet properties would be the cheapest and quickest way to make more social housing available. There are 8 million council or housing association homes in England and 1.8 million households on the waiting list. Tackling subletting and property misuse could go a long way to releasing the 1.8 million homes to genuine tenants in waiting.
Of the 4.1 million socially owned homes 2.2 million are rented from local authorities, and 1.9 million from other social landlords. This is a national asset that needs to be protected from people who want to misuse that asset. That misuse takes many forms. For example, we will investigate:
- Unlawful subletting, including
- subletting the whole property to a single household
- multiple sublets within one property
- Non-occupation by tenants as their principal home
- Wrongly claimed succession: retention of a tenancy following the death or vacation of the tenant following a previous succession, or of a non-qualifying person.
- Unlawful assignment
- “Key selling”, where the tenant leaves the property and passes on the keys in return for a one-off lump sum payment or favour
- Fraudulently obtaining a social housing tenancy, including
- misrepresentation of identity
- misrepresentation of circumstances
“Paul has a detailed knowledge of Council procedures and is down to earth and culturally aware… I would have no hesitation in recommending Paul to carry out this type of operation in the future.”
“BBFI have the infrastructure, specialist staff and knowledge to start a fraud team and effectively run it.”
“In the first six months BBFI investigated 100 cases and closed 53. The housing officers in partnership with BBFI have recovered the keys to or issued Notices to Quit (NTQs) in eleven cases and 47 are open and under investigation. Some of the open investigation cases are under long-term surveillance. This equates to a property recovered or NTQ issued every seven days worked.”
“Total costs spent on the BBFI services to date total £25k. Taking into account the 3 cases where RTB applications were withdrawn and assets retained in our stock as well as three cases where vacant possession was gained without costs of legal action we estimate the savings to the housing association to be upwards of £300k”
“I am proud of what we have achieved so far with the continued help of BBFI.”
“Through the partnership our staff are being upskilled to enable them to carry out more complex investigations.”
“We did not have the resources or the experience to tackle such a far reaching problem and had no idea where to start. We decided to hire professionals, BBFI on a trial basis which became more permanent.”
“As a result of 31 investigations the right to buy team working with BBFI have uncovered fraudulent application and housing benefit fraud. Five applications have been withdrawn, each of which had a potential discount of over £100k. Of the 31 applications investigated nine have completed the intended home ownership and have purchased their homes and 17 are still under investigation.”