Legal News

Benefit fraud investigators have uncovered a benefit scam involving small numbers of former asylum seekers housed in luxury flats in London paid for with housing benefit – who go on to sublet the properties to wealthy tourists.

The Daily Mail reports that investigators for the Department for Work and Pensions (DWP) have found 21 benefit cheats living in four blocks of luxury apartments in London’s West End, who between them have allegedly earned more than £100,000 each in subletting fees during the three years they have been renting the apartments and claiming benefits.

A family of six living in a £1 million apartment on £500-worth of benefits a week had sub-let to wealthy tourists for £3,000 a week, investigators found.

The apartments are high-end properties with a concierge and landscaped gardens.

Many of the benefit cheats are thought to be Iraqi Kurds fleeing war zones. It is thought the benefit claimants have cost the taxpayer more than £250,000 in housing benefit, however, while subletting the properties the DWP housed them in.

A Marylebone-based estate agent has said he has been aware of scams for around 20 years – but recently these had increased significantly.

Hany Hanna said:

“They come into my office asking which blocks are best to rent – some of them will come to the UK with a piece of paper with instructions on how to do things.

“First you have to be pregnant, then go to the housing department – they give you a flat.

“After you get the flat, you move into another place, give the keys to an agent – he will find you a tenant and you’ll be making ‘double whammy’ – money from the government and making money from the flat the government gave you,” Mr Hanna said.

According to Westminster’s anti-fraud tsar, Councillor Lindsey Hall, many families were former asylum seekers granted refugee status in the UK. Once they have secured a property to rent, they then go and live in cheaper accommodation and rent out the flat – often to wealthy families from the Gulf States who are holidaying in London.

It is reported that the 21 benefit claimants alleged to have claimed benefit fraudulently have had their claims cancelled and may face civil legal action for the recovery of the benefits they claimed while renting out properties.

Cllr Hall said criminal proceedings might not be instigated, however, because of the “high burden of proof” required in such cases involving high legal costs to the council.

“We are asking for a more rigorous system where the onus isn’t always on local authorities to spend tens of thousands of pounds and conduct months of work to prove that someone is claiming benefits fraudulently,” Cllr Hall said.

“Tougher tenancy agreements would be a starting point – and a fully traceable, fully transparent money trail ahead of that agreement being put in place.

“We need same rigour as in the private sector,” she added.

Duncan Lewis Fraud Solicitors

Duncan Lewis is a leading firm of fraud solicitors and can advise at any stage of a charge for fraud, including charges relating to:

• Benefit fraud
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For expert legal advice on fraud charges, call Duncan Lewis fraud solicitors on 020 7923 4020.