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£2bn lost to criminals in furlough cash fraud


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Organised criminals have siphoned off up to £2 billion intended for furloughed workers, tax officials believe.

HM Revenue & Customs has estimated that between 5 and 10 per cent of £39 billion in payments made under the Treasury’s job retention scheme are likely to have been claimed fraudulently.

Of these, it is “almost certain” that more than half has been paid to organised criminals posing as legitimate businesses to make claims under the emergency scheme, tax officials have told the National Audit Office.

As well as organised crime, the NAO said that other types of fraud included employers making furloughed employees work or inflating claims.

https://www.thetimes.co.uk/edition/news/2bn-lost-to-criminals-in-furlough-cash-fraud-mh95x3qhh

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What about the bounce back loans too? Tip of the iceberg...

 

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£26bn and counting they reckon on bounce back loans. £2bn on furlough fraud which is probably going to increase again now, plus those getting another job and getting furlough at the same time. Help out to eat out was probably a few £100 million more in fraud. Then you have councils dishing out grants (like that Transvestite getting £200k from Brighton council in the other thread) and frankly if you haven’t been on the receiving end of this money hose you are probably in the minority and should be getting very very angry because even before the tax hikes you are getting screwed right over.

 

Anyone know where these tier 3 grants from central government are going? £60m to Manchester - how is that meant to be divided up, to the councillors mates or what?

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Tories:  We don't pay for kids to have food because it encourages them being lazy

They have never ever said that. 

However I do not see why anyone other than they very disadvantaged should be entitled to free food.  All that does is create a level of entitlement and dependence which is self destructive and unrealistic.  

It is easy to cook cheaply by buying fresh vegetables and making an effort rather than buying processed rubbish from Tesco etc at hugely inflated prices.  

I do not see why as a taxpayer I should be expected to pay for everyone else's children.  We do not ask anyone to pay for my kids. They are our responsibility not that of the rest of the country.  

There are too many people who have no job or a poorly paid job who bang out a load of kids and then seem amazed at the fact that the kids they have produced need food, clothes, shelter.  We would have loved to have had a couple more kids but we understood that that is a huge financial commitment and we would not be able to give them the sort of home we wanted then to have and the amount of time we are able to give.  

People now seem to think every problem they have is the government's and the taxpayers problem and expect them to look after them rather than think about what they can do to help themselves.  

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£26bn and counting they reckon on bounce back loans. £2bn on furlough fraud which is probably going to increase again now, plus those getting another job and getting furlough at the same time. Help out to eat out was probably a few £100 million more in fraud. Then you have councils dishing out grants (like that Transvestite getting £200k from Brighton council in the other thread) and frankly if you haven’t been on the receiving end of this money hose you are probably in the minority and should be getting very very angry because even before the tax hikes you are getting screwed right over.

 

Anyone know where these tier 3 grants from central government are going? £60m to Manchester - how is that meant to be divided up, to the councillors mates or what?

Dont forget the PPE scandal.

£300m and counting to one "pest control" company alone. in "" as well it had no real assets.. and all the directors and shareholders changed as soon as the contracts were awarded.. almost like it was a shell?....

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They have never ever said that. 

However I do not see why anyone other than they very disadvantaged should be entitled to free food.  All that does is create a level of entitlement and dependence which is self destructive and unrealistic.  

It is easy to cook cheaply by buying fresh vegetables and making an effort rather than buying processed rubbish from Tesco etc at hugely inflated prices.  

I do not see why as a taxpayer I should be expected to pay for everyone else's children.  We do not ask anyone to pay for my kids. They are our responsibility not that of the rest of the country.  

There are too many people who have no job or a poorly paid job who bang out a load of kids and then seem amazed at the fact that the kids they have produced need food, clothes, shelter.  We would have loved to have had a couple more kids but we understood that that is a huge financial commitment and we would not be able to give them the sort of home we wanted then to have and the amount of time we are able to give.  

People now seem to think every problem they have is the government's and the taxpayers problem and expect them to look after them rather than think about what they can do to help themselves.  

The sensible / political move, would have been to covert the additional universal credit / child credit being used into food vouchers going forward.

 

People who have issues funding others children would probably on balance prefer to fund others children's food than other items.

People campaigning for it would be stuck arguing that X is more important than children's food which is difficult to do...

Clearly in the real world people are prioritising X over their children's food. As to not be implies they have no income whatsoever, which is certainly not the case when you add all the benefits together for those with kids.

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Has no one noticed yet......

 

10% of £39bn is £3.9bn so the article should say up to £4bn!

Yeah that's just fraud in general. Of that 10% - £2billion has been estimate to goto organised crime - as apposed to Jack trying it on by putting himself on furlough and working elsewhere or doing work.

Its good eh?

Next time they say watching a pirate DVD funds terrorism.. just remember £2billion of taxes has gone straight out the door to them through this or if not terrorists, just your average organised crime member.

Oh BBL its another £5billion to organised crime.. 

Not bad going.

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Tories:  We don't pay for kids to have food because it encourages them being lazy

Tories: Here have some random bail out cash. That won't encourage anything.

That's just double standards spin from you, I'm afraid.

The furlough scheme was the Tories acting fast to help people who otherwise would have been suddenly unemployed in their millions.

Are you saying they should have let half the country go bankrupt just so that there was no chance of any fraud?

So what about the food for kids then?  Presumably if your main concern is 0% fraud we shouldn't give out free food either just in case a few of the claimants are genuine hungry children's parents?  Or maybe you think we have some kind of red tape mountain so we pay £3 per child in audit fees to establish they genuinely need a £1 benefit?

 

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All this has happened under the watch of a Tory government who are meant to be extremely prudent and watchful. Its absolutely criminal that they have borrowed and spunked billions like this. It all has to be repaid at some point, interest on these loans will cripple the public spending and taxes will have to go up massively to balance out this madness.

What really annoys me is that I got nothing out of this, worked my ass off through the year, no furlough, no holidays. Yet, I know that in a few years time I will be taxed at 60% of my salary so the country does not go bankrupt.

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That's just double standards spin from you, I'm afraid.

The furlough scheme was the Tories acting fast to help people who otherwise would have been suddenly unemployed in their millions.

Are you saying they should have let half the country go bankrupt just so that there was no chance of any fraud?

So what about the food for kids then?  Presumably if your main concern is 0% fraud we shouldn't give out free food either just in case a few of the claimants are genuine hungry children's parents?  Or maybe you think we have some kind of red tape mountain so we pay £3 per child in audit fees to establish they genuinely need a £1 benefit?

 

Thats not really the point.. its not "black" or "white".

You can just chuck cash out the door to anyone that requests it or you can put checks in place, which cause some delay but stop fraud. They went for the former.

 

Take the BBL scheme. Banks warned with no checks it would be a target for organised crime. Checks would have taken 2 - 4 weeks. They said no, cash within 24 hours. 

That choice meant organised crime walked off with £5billion estimated, and the taxpayer is on the hook for £26billion estimated.

The notion that a business HAD to have the cash in those exact 24 hours was nonsense. Everyone involved in a business knows you can worst case delay payments for 2 to 4 weeks, and not every business was within 1p of their overdraft on application.

That was a choice they made... IMHO it stinks of not giving a monkeys as its "other peoples money", something the tories used to have a reputation of being above.

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All this has happened under the watch of a Tory government who are meant to be extremely prudent and watchful. Its absolutely criminal that they have borrowed and spunked billions like this. It all has to be repaid at some point, interest on these loans will cripple the public spending and taxes will have to go up massively to balance out this madness.

What really annoys me is that I got nothing out of this, worked my ass off through the year, no furlough, no holidays. Yet, I know that in a few years time I will be taxed at 60% of my salary so the country does not go bankrupt.

Exactly true. Not had a day off and worked harder than ever post lockdown. And will probably have to pay for it. I don't think furlough should have been paid nor bounce back loans. Consenting adults decided to take employment in a sector that became non viable in a pandemic. I'm sorry but that is their decision. I chose to do a job I could do from home and left a job I couldn't because I costed this into my decision. It seems like nobody actually wants to take responsibility for themselves and retrain. For example I have no idea why anyone would want to work in hospitality unless it is whilst training for another job. Surely you train and take up employment in such a way as you can switch careers should your business become unviable like most hospitality is now. If you are ever in the stage where you job prospects are only one industry then there is a career planning issue there.

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Exactly true. Not had a day off and worked harder than ever post lockdown. And will probably have to pay for it. I don't think furlough should have been paid nor bounce back loans. Consenting adults decided to take employment in a sector that became non viable in a pandemic. I'm sorry but that is their decision. I chose to do a job I could do from home and left a job I couldn't because I costed this into my decision. It seems like nobody actually wants to take responsibility for themselves and retrain. For example I have no idea why anyone would want to work in hospitality unless it is whilst training for another job. Surely you train and take up employment in such a way as you can switch careers should your business become unviable like most hospitality is now. If you are ever in the stage where you job prospects are only one industry then there is a career planning issue there.

I’m the same, I work in a very small but safe section of a large company that has been hit badly overall by this. We have worked like dogs throughout and had a 10% pay cut for our troubles whilst the insecure lot have been on furlough for the whole thing (there have been some redundancies too I will note). One of the reason I work in this particular sector is because I am very risk adverse but since no one is being allowed to realise their individual responsibility I’m starting to think that I made a mistake. I could have used a few months off to get chartered etc and now I’m angry that I’ve been robbed of the ‘opportunity’ of time afforded to others. The compensation was that furlough would expire, but this just seems to have been pushed back. How much notice do people need, surely 6 months was more than enough to get their house in order?

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Great news, the Tories are creating thousands of millionaires over night 🤑. HPI ponzi forever!
Johnsonomics is now putting NSI's Ernie to shame (slacker, only once a month premium bond draw).

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1 hour ago, gerkin said:

What really annoys me is that I got nothing out of this, worked my ass off through the year, no furlough, no holidays. Yet, I know that in a few years time I will be taxed at 60% of my salary so the country does not go bankrupt.

On the bright side, at 60% tax, house prices would have to drop 😅

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Thats not really the point.. its not "black" or "white".

You can just chuck cash out the door to anyone that requests it or you can put checks in place, which cause some delay but stop fraud. They went for the former.

Are you saying there were literally NO checks?  None at all?  I just fill in a website form and get millions of pounds....?

Or is it really that there's a massive sliding scale of possible checks vs costs and every poster on here would probably have set the slider at a different point.

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Slightly off topic but see the data attached for public sector finances summary, the mind boggles - source ONS.

The longer this is drawn out as a saga then the longer these finances keep creeping up. And the longer criminals will keep taking their fraudulent piece of the public pie.

Interestingly, media and government tend to use the excluding bank debt figures, if you look at those the scenario is even worse.

Summary.xlsx

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Are you saying there were literally NO checks?  None at all?  I just fill in a website form and get millions of pounds....?

Or is it really that there's a massive sliding scale of possible checks vs costs and every poster on here would probably have set the slider at a different point.

For Bounce back loans?

Yes.

You could have created a company in April as a shell, and got £50k.

Its actually better than that... for the first few weeks they didn't even check if you had already applied elsewhere... so you could get 10 bounce back loans with your newly created shell so £500k as some criminals did. 

 

That in line with your sliding scale? sound reasonable? The banks didnt think so, warned the government, got indemnified against it. The government did it anyway - how to get cash out in 24 hours.

 

From the NAO 

"The NAO report warned that the speed with which the scheme was rolled out heightened the fraud risk. It took a month to ensure businesses could not receive more than one loan"

And from a whistleblow;

 

‘The scale of this fraud is eye-watering. I encounter shocking cases every hour of every day’ 

By an anonymous senior Government investigator 

Out of adversity springs opportunity. Just as wartime spivs milked the black-market potential of the Blitz, so too are modern criminals and greedy opportunists exploiting the pandemic and, in particular, the Government’s generosity with your money.

Most of you are aware it is going on, but few will realise the outrageous, eye-watering scale of daily abuse. Millions of pounds, quite possibly billions, have been lost to Covid-19 fraud.

As a member of teams set up to combat the problem, I’ve encountered shocking cases every hour of every day. Take this one: a guy owning seven shell companies managed to secure a £50,000 Bounce Back loan for each one, so £350,000 in all.

The whistleblower says the cases they see are of such a high magnitude that they are  referring them to the Serious Fraud Office and National Crime Agency all the time
 
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The whistleblower says the cases they see are of such a high magnitude that they are  referring them to the Serious Fraud Office and National Crime Agency all the time

Yet shell companies have no assets and are merely used to hold money. So why on earth was he deserving of an emergency loan aimed at helping small businesses? He wasn’t, of course.

When we rang he was evasive. ‘I’m in a bank, I’ll call you back.’ We were tracking him via his mobile phone so knew that he was lying and that he was elsewhere. Indeed, we got on to him in the first place because one of the identities he was using was stolen from a man who died last year.

Lockdown triggered a gold rush: Universal Credit, Bounce Back loans, furlough scheme payments, it was all up for grabs.

There was, sadly, an inevitability about it from the start. Soon after lockdown, the Department for Work and Pensions came up with the comforting phrase, Trust and Protect. This underpinned the Government’s approach to emergency pandemic loans. The idea was that people could get money without providing evidence and without face-to-face interviews. People were taken at their word, questions could come later.

Criminals and fraudsters, many of them part of European gangs, rubbed their hands with glee. All their Christmases had come at once. It has meant we’ve lost hundreds of millions of pounds to what must be the most systematic campaign of fraud this country has ever seen.

For myself and colleagues in the DWP anti-fraud team, it’s been the fight of our lives.

Before lockdown in March, we each worked at any one time on a couple of hundred suspicious cases across our area in the Counter Fraud and Compliance Debt Directorate. By June, that had spiralled to 15,000, and that’s just for Universal Credit and just in one small region.

And it’s systematic. If it’s money being handed out by the Government, these criminals are on to it. Only it’s not the Government’s money, of course, it’s our money and we’ll be paying it back for generations.

My day starts around 8am when I switch on my computer to see a flood of new emails in my inbox, all new cases. Each one doesn’t involve hundreds of pounds or even thousands. They are for tens of thousands and hundreds of thousands.

And it keeps going up. The cases we see are of a magnitude that means the Serious Fraud Office and National Crime Agency are often on the phone – and we’re referring cases to them all the time. What I see every day is that 80 to 90 per cent of the fraud is carried out by people from Eastern European countries. It’s almost exclusively those from Romania, Poland, Albania, Bulgaria and Turkey.

Our department has always had a team looking at fraud by Eastern European and Balkan criminals, but this is another level.

It might sound a bit dramatic but we’re under attack and as far as I’m concerned these criminals are pushing Britain to financial ruin.

 

 
Edited by captainb
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Great news, the Tories are creating thousands of millionaires over night 🤑. HPI ponzi forever!
Johnsonomics is now putting NSI's Ernie to shame (slacker, only once a month premium bond draw).

I don't know why they can't just gift 50k PB holders a million a month. Prop the economy innit.

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For Bounce back loans?

Yes.

You could have created a company in April as a shell, and got £50k.

Its actually better than that... for the first few weeks they didn't even check if you had already applied elsewhere... so you could get 10 bounce back loans with your newly created shell so £500k as some criminals did. 

 

That in line with your sliding scale? sound reasonable? The banks didnt think so, warned the government, got indemnified against it. The government did it anyway - how to get cash out in 24 hours.

They where using fake ID so as many companies as they like I imagine some gang had maybe 100s millions away.

Kinda makes me wish I had a go myself what's the worst that could happen ?

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They where using fake ID so as many companies as they like I imagine some gang had maybe 100s millions away.

Kinda makes me wish I had a go myself what's the worst that could happen ?

If you are sitting in Spain, or Dubai or Albania etc.. Not a lot.

Some will have got £50m or more of taxpayers cash. Thats 100x frauds of £500k each. Not bad going for a gang.

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If you are sitting in Spain, or Dubai or Albania etc.. Not a lot.

Some will have got £50m or more of taxpayers cash. Thats 100x frauds of £500k each. Not bad going for a gang.

You never know they may invest in some UK property with it. 🤣

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Organised criminals have siphoned off up to £2 billion intended for furloughed workers, tax officials believe.

HM Revenue & Customs has estimated that between 5 and 10 per cent of £39 billion in payments made under the Treasury’s job retention scheme are likely to have been claimed fraudulently.

Of these, it is “almost certain” that more than half has been paid to organised criminals posing as legitimate businesses to make claims under the emergency scheme, tax officials have told the National Audit Office.

As well as organised crime, the NAO said that other types of fraud included employers making furloughed employees work or inflating claims.

https://www.thetimes.co.uk/edition/news/2bn-lost-to-criminals-in-furlough-cash-fraud-mh95x3qhh

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What about the bounce back loans too? Tip of the iceberg...

 

And here they are...

Boris Johnson cabinet now two-thirds privately educated after reshuffle,  compared to 7% of UK population | The Independent | The Independent

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