Universal Credit loophole that Tories never fixed leads to huge ID theft scam

Amber Rudd: This scandal has come to light on her watch. Will she take responsibility and quit (again)?

The government is handing huge wodges of cash to identity thieves because of a loophole in Universal Credit that the Tories were either too stupid to anticipate, or about which they simply didn’t care.

In all honesty, the scam also relies on the victims themselves being stupid and desperate.

Fortunately for the scammers, economic conditions created by – guess who? – the Conservative government has nurtured an atmosphere of desperation among thousands upon thousands of people who are living hand-to-mouth – and desperation leads people to do unwise things.

It works like this:

The scammer approaches the victim – a person in need of quick cash – and offers to get them a government grant or a payday loan for a small fee. They demand the victim’s identity details.

How do these scammers know who to target? The victim on the BBC News website says she was approached by a smartly-dressed man with a Job Centre Plus card. Where are these people getting their information?

The scammer then simply goes online and makes a Universal Credit claim in the victim’s name, demanding an advance loan in the process.

The DWP’s online system automatically approves the claim because it doesn’t know any better and transfers the money into the victim’s bank account – from which the scammer then takes a huge amount of the money that has been handed over.

The victim is left with a small fraction of the loan, but owing the entire amount back to the DWP. Not only that, but any other benefits they may have been claiming will have been cancelled.

So the victim is left much worse-off – and the government department doesn’t care. It will pursue them for the full amount.

It seems the scam works because of Universal Credit’s “digital by design” nature; the computerised system automatically approves the application, no matter how bizarre the claims in it.

So thousands of pounds have been given in response to claims on behalf of (allegedly) a 19-year-old with six blind children, people with children called Lisa, Bart and Homer – or indeed Ha, Ha and Ha – and people claiming “Harry Kane” is their landlord.

Apparently 100,000 or more such advances are being paid every month. At up to £1,500 a go, that’s a lot of money.

Now get ready for the double-punchline.

Remember when the Tories were trying to accuse genuinely sick and disabled people of benefit fraud, claiming they were “scroungers” and “skivers” to take their cash and drive them to their deaths?

The fraud rate at the time was just two per cent. Now, DWP estimates suggest fraud has skyrocketed – because of a loophole that the government built into the system.

That’s the first punchline.

Here’s the second: This scam was reported by the Daily Express more than a month ago but the BBC has only brought it to wider public attention today.

Why the delay?

Is it because nobody trusts the news media anymore, after they spent the last few years pushing pro-Tory government propaganda?

Source: Universal credit: Multi-million pound scam targets claimants – BBC News

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6 thoughts on “Universal Credit loophole that Tories never fixed leads to huge ID theft scam

  1. stevedavidh

    This has been known about for over 2 months. The CAB were warning about this at the beginning of May. Which begs the question, how long have the DWP known about this fraud that preys on the most vulnerable.

    “‘SMARTLY-dressed’ fraudsters are targeting families on benefits in a new scam, the Citizens Advice has warned.
    The conmen, claiming to be from the Department for Work and Pensions (DWP) prey on people as they leave from job centres, with the promise of offering ‘government loans’.


  2. Gary

    This kind of loophole was ALWAYS possible, even prior to UC. I worked in the Civil Service at the implementation of Tax Credits and saw the resultant mess (caused ENTIRELY by politicians and NOT the Civil Service, ministers were WELL warned beforehand)

    This is merely an extension of that. It has simply become more widely known and those who seek to take advantage of those on benefits have become slightly more sophisticated in their methods and have been working yet harder to make money from them.

    This is an INHERENT problem with this system and even prior to new reports is known to the Civil Service who have been at pains to try and get government ministers to actually DO something. The fact that this has been ongoing in one forma or another for over ten years now means that no politician of ANY party wants to tackle it.

    They MIGHT announce a review, then kick it into the long grass as soon as the papers forget it. Or the old chestnut of blaming Civil Servants for their own failings…

  3. Justin

    I hope they face full GDPR Regulations and a fine at the same level as British airways

  4. AM-FM

    “How do these scammers know who to target?”

    Since everything went on-line, almost anyone can post a fake “Job” advert.
    In fact you can be mandated by JCP or a provider/parasite to apply for a vacancy that’s obviously fake to a very regular job-searcher, guess how I know this. 🙂

  5. Dave Rowlands

    I’m beginning to wonder if I should give up my meagre life as a pensioner and become a scammer, is this in one of the Job Descriptions at the, what do they call it now?

Comments are closed.