Benefit Fraud Sanction Policy

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Contents

• Introduction
• Policy statement
• General principles
• The decision making process
• Decision to prosecute
• Alternatives to prosecution
• Authority to prosecute or apply a sanction
• Other methods of redress
• Disciplinary

1. Introduction

1.1  Wiltshire Council is committed to protecting the public funds through its action against benefit fraud. This document sets out the Councils policy towards prosecution and other sanctions available for benefit fraud offences. The policy forms an integral part of the Council’s overall strategy to prevent, detect and deter fraud promoting high standards of governance and accountability.

1.2  The decision to prosecute an individual is a serious step. Fair and effective prosecution is essential to the maintenance of law and order. This document serves as a policy statement for Members of the Council, and as an operational guide for those involved in the decision making process.

2. Policy Statement

2.1  The Council will not tolerate abuse of welfare benefits by claimants, landlords or internally by staff. The Council will take an active stance against those that abuse the benefit scheme and any allegations of fraud will be vigorously investigated.

2.2  The Council will seek full redress through the law of any internal or external fraudulent activity perpetrated against it. This redress may be actioned through either the Criminal and/or Civil Courts as deemed appropriate.

2.3  Where suspected cases of fraud have been investigated, and sufficient evidence has been obtained to sustain a prosecution, the Council will seek to impose one of the following sanctions:

• A local authority caution
• An administrative penalty
• A prosecution

2.4  The introduction of the Welfare Reform Act 2007 (WRA) allows local authorities to investigate Housing Benefit/Council Tax Benefit and certain other national benefits with effect from 7th April 2008. Sections 46 to 48 define the extent of these powers and the certain national benefits, namely:

• Income Support (IS)
• Job Seekers Allowance (JSA)
• Incapacity Benefit (IB)
• State Pension Credit, and
• Employment and Support Allowance (ESA)

2.5  The Council will continue to work with other agencies to reduce and prevent the incidence of fraud. The Investigation Unit has already entered into a closer working partnership agreement with the Department for Work and Pensions (DWP) Fraud Investigation Service (FIS). One of the main objectives is to ensure a consistent approach to the use of sanctions by both organisations.

3. General Principles

3.1  Each case must be considered on its own facts and merits. However, there are general principles that must be applied in all cases.

3.2  Officers tasked with undertaking investigations into allegations of fraud must be Accredited Counter Fraud Officers (ACFO) and have regard to all legislation and statutory guidance relating to criminal investigations, including the Police and Criminal Evidence Act 1984, the Code of Practice for Crown Prosecutors and the Criminal Procedure and Investigations Act 1996. Note: Relevant legislation and guidance can be found on the Home Office website

3.3  For the purposes of the Human Rights Act 1998 Wiltshire Council is a public authority. Therefore officers must apply the principles of the European Convention on Human Rights in accordance with the Act. Note: Relevant legislation and guidance can be found on the Home Office website

3.4  Officers must not allow any personal views about ethnic or national origin, disability, sex, religious beliefs, age, political views or the sexual orientation of the alleged offender to influence their decisions.

4. The Decision Making Process

4.1  Where an offence has been committed the Council can consider administering a caution, offering an administrative penalty or instigating a prosecution. In considering an alternative sanction to prosecution the Council must be satisfied that the case would still qualify for court action on the strength of evidence and the public interest factors.

5. Decision to Prosecute

5.1  As a general rule, the Council will consider a case for prosecution if one or more of the following criteria is met.

the amount of fraudulent overpayment is greater than £2000. The DWP has set a benchmark of an adjudicated fraud overpayment of £2000, or more. Although it is appropriate to have the benchmark below which action should not be taken the council will consider prosecution for lesser amounts in exceptional circumstances, such as attempted fraud or where other sanctions have been refused or defaulted.

• the person concerned occupies a position of trust
• the person has declined an administrative penalty
• the person has declined a caution
• the person has already received a caution or administrative penalty
• the person has previous convictions for similar offences
• there is evidence of premeditation or organised fraud
• the person has assisted or encouraged others to commit offences

5.2  In all cases the Council must be satisfied that there is a realistic prospect of conviction. Therefore, it is essential that there is sufficient admissible evidence so that a court, properly directed in accordance with the law, is more likely than not to convict the defendant of the alleged offence.

5.3  When deciding whether there is enough evidence to prosecute, the Council must consider whether the evidence can be used and is reliable. This is known as the evidential stage.

The Evidential Stage

5.4  There must be sufficient evidence to provide a realistic prospect of conviction against each defendant on each recommended charge. The Council needs to prove beyond reasonable doubt that an offence has been committed. In considering the evidence the following factors should be considered:

(i)  Any evidence held should be admissible, reliable and sufficient so that a court properly directed in accordance with the law is more likely to convict than dismiss the case against the defendant.

(ii)  Any circumstances and/or evidence is made available to the defence, which could cause a doubt in the prosecution’s case.

5.5  In deciding the strength of the prosecution case the following factors should be considered:

(i)  The reliability of any admission taking into account the defendant’s understanding or lack of understanding of all the circumstances.

(ii)  The strength of the evidence of witnesses. The case may be weakened if the defence questions their reliability because of their motive, background, or previous convictions.

(iii)  The evidence of the defendant’s identity should be strong enough to withstand any questioning by the defence.

5.6  If the case does not pass the evidential stage it is unsuitable for prosecution, no matter how serious the allegations are. If the evidential stage has been satisfied, a decision will be made as to whether or not it would be in the public interest to prosecute. Cases that pass the evidential test will not automatically be prosecuted and various factors should be borne in mind when considering whether or not it is in the public interest to do so.

Public Interest Factors

5.7  The Public Interest factors can increase the need to prosecute or may suggest an alternative course of action. These factors will vary from case to case and not all the factors will apply to each case. It is a matter of common sense which factors are relevant and which do not apply. In making the decision to prosecute all available information must be carefully and fairly considered.

5.8  The Code for Crown Prosecutors should be used as a guide in determining whether or not  prosecution is in the Public Interest. The latest copy of the code can be found at www.cps.gov.uk. All cases where the evidential and public interest factors have been satisfied should be considered for prosecution if the relevant criterion is met.

5.9 Failure to consider Evidential and Public Interest factors when reaching a decision on prosecution can have serious consequences. The laying of criminal information when there is insufficient evidence to do so can amount to an abuse of the process leaving the prosecutor open to legal action by the intended defendant.

6. Alternatives to Prosecution

6.1  Cases, which qualify for court on the strength of evidence but where the public interest factors indicate that prosecution may not be appropriate, can be considered for an alternative course of action to prosecution.

6.2  The defendant must give his informed consent to the alternative procedure to prosecution being offered. If the offer is declined criminal proceedings must always be considered. This means that an investigation must have been undertaken as if it was the intention to prosecute. It would be a serious misuse of power to offer an alternative to prosecution in any case where there is not a realistic prospect of a prosecution succeeding in court.

The Administrative Penalty

6.3  Section 115 of the Social Security Administration Act 1992 (ref: www.dwp.gov.uk) allows Local Authorities to issue an administrative penalty as an alternative to prosecution where:

(i)  Grounds exist for instituting proceedings

(ii)  Prosecution is possible but not the preferred option

(iii)  The case is not so serious that prosecution should be considered from the outset and:-

(iv)  The offer of an administrative penalty would not cause severe financial hardship placing vulnerable family members at risk

6.4  Administrative Penalties can be issued to:

(i)  Benefit claimants who are believed to have committed an offence

(ii)  Employers of benefit claimants who are believed to have committed an offence and where the employer has condoned, hidden or assisted the alleged offender in committing an offence.

6.5 Benefit Customer - Administrative Penalty

This is a financial penalty amounting to 30% of the gross adjudicated overpayment and can be offered if the following conditions are met:

(i)  There is recoverable overpayment of Benefit under, or by virtue of, sections 75 or 76 of the Social Security Administration Act 1992;

(ii)  The making of the overpayment was attributable to an act or omission on the part of the defendant.

(iii)  There are grounds for instituting criminal proceedings for an offence relating to the overpayment upon which a penalty is based.

(iv)  It is a first offence where the overpayment is generally below £2000

6.6 Employer – Administrative Penalty

An employer administrative penalty can only be offered if the offence occurred after the commencement date of 30th April 2002. The level of employer penalty will be based on the circumstances of the offence:

6.7 If a person declines to agree to pay a penalty, or subsequently changes their mind, the case must then be considered for criminal proceedings unless exceptional circumstances apply.

A Caution

6.8  A caution is an oral or written warning given to a person who has committed an offence as an alternative to prosecution. In any case selected for caution there must be evidence to prove the offence, including a full and frank admission on all aspects of the offence at the Interview Under Caution and the person being cautioned must give his informed consent to the procedure. Note: A caution is a deterrent and does not affect the recipient except by re-offending when it can be cited in court on conviction. Where a caution has been declined the case must then be considered for criminal proceedings unless exceptional circumstances apply. 

6.9 The Council will consider offering a caution in appropriate cases. These will include:

(i)  a first offence which was disclosed by the defendant.

(ii)  a first offence where the overpayment is generally under £2000.

7. Authority to prosecute or apply a sanction

7.1  Where a case has been investigated and the investigator believes the case has been proven, the investigator will make recommendation on the appropriate action to be taken. The subsequent recommendation will be reviewed and either approved or rejected by the Investigations Manager. All cases either approved or rejected will be referred to the Head of Service.

7.2 The Head of Service will consider and decide upon the Investigation Managers recommendation. The decision will be formally recorded and where appropriate the investigator will commence proceedings.

7.3  The Solicitor acting for the Council will make the final decision as to whether a case is suitable for criminal proceedings after taking into consideration the Code of Conduct for Crown Prosecutors and this policy.

8. Other methods of redress

8.1  The Council will refer all suitable cases for financial investigation with a view to applying to the courts for restraint and/or confiscation of identified assets under the Proceeds of Crime Act 2002. (for offences prior to 23/03/03 CJA 1998). Note: Relevant legislation and guidance can be found on the Home Office website  A restraint order will prevent a person from dealing with specific assets. A confiscation order will enable the Council to recover its losses from assets which are found to be from the proceeds of crime.

8.2  Where an overpayment arising from fraud is identified the Council will take steps to recover the resultant debt, including taking action in the Civil Courts if necessary, this will be in addition to any sanction it or the Criminal Courts may impose in respect of that fraud.

9.Disciplinary

Where a member of staff has received a formal caution, an administrative penalty or has been found guilty by the Court of a benefit fraud offence, the Head of Service will report the matter to Human Resources for consideration of disciplinary action.

Review date December 2010

Last updated: 3 February 2011