Consequences of Benefit Fraud

As part of the changes to the welfare system, stricter action can be taken if you receive an overpayment as a result of benefit fraud.

What’s the change?

Loss of Benefit

Depending on the severity of the benefit fraud, and if you have any previous benefit fraud convictions, your benefits could be stopped for 13 weeks, 26 weeks, or a maximum of three years.

For the most serious cases involving organised or identity fraud, there will be an immediate loss of benefit for three years.

Administrative Penalties

If you make a false claim for benefits, you could have an administrative penalty applied. The penalty is 50% of the overpayment. For example, if you were overpaid by £900 you would have to pay a penalty of £450. However, there is a minimum penalty that can be applied of £350 and the maximum penalty is £2,000.

If the Department for Communities think you have tried to commit benefit fraud, they will be able to consider applying a fixed penalty of £350, as an alternative to prosecution.

When will this happen?

The administrative penalties can be applied from 4 April 2016.

The stricter loss of benefit changes will be introduced at the same time as Universal Credit.

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