Officials will be able to look at bank statements and directly take funds from accounts
The DWP has been urged to clarify who will be targeted by new anti-fraud powers. New measures in the Public Authorities (Fraud, Error and Recovery) Bill will allow officials to directly take funds from people’s account and to request details of bank statements when they intend to do so, to verify they have the funds available to pay up.
Experts appeared before MPs last week to voice their concerns about the draft legislation, which is going through Parliament. Dr Rasha Kassem, senior lecturer and leader of the Fraud Research Group at Aston University, raised concerns about who exactly would be targeted.
She said the bill needs to be clarified as to differentiating between fraud committed by individuals as opposed to be organisations. She urged: “I think this needs to be sorted in the Bill, not afterwards. For example, from a governance perspective, in the bill you say that you can access banks accounts and freeze assets, but whose?
“Are you going to take the assets from the organisation, the directors running the organisation or the fraud perpetrators inside the organisation?” She said this needs to be sorted before the bill is put into law, as it could cause later issues if a case goes to court: “This has to be sorted, because you will be faced by another issue, at least in courts, saying who is the controlling mind in the organisation.
“The organisation has a mind of its own legally, and therefore cannot be treated in the same way as when you deal directly with individuals. If that is sorted, there will hopefully be a higher probability of recovery and fewer loopholes in the bill.”
Ms Kassem also criticised the bill for assuming that fraud is due to financial motives when this is not always the case. She explained: “If you consider insider fraud, fraud committed by insiders, people working for the public authorities, which is one of the most common threats not just in the public sector, but across other sectors. A disgruntled employee can be as dangerous as someone with a financial motive.”
The powers allow officials to take a lump sum amount from a person’s account or to arrange for regular payments to recover the funds. The measures could be used by other public authorities than the DWP, with anti-fraud officials for the NHS saying they will also use the new powers.
Alex Rothwell, chief executive of the NHS counter-fraud authority, told the MPs: “There is a lot more value to be had. The bill will be incredibly helpful for us to recover more money from people who have been suspected of fraud.”
He spoke about the kind of cases that they may use the powers to target: “When it comes to pursuing criminal justice outcomes in relatively low value cases – perhaps individuals who have taken £5,000 or £10,000, who have been exited through human resources processes or who have simply left the organisation – the bill gives us an incredible opportunity to recover more funds, and I think we would use it extensively.”
