CONTENTS

3 Background

3 Counter fraud management

4 Multi-agency work

4 Investigative work

6 Appendix A: Summary of investigative work

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Background

1 Fraud is a significant risk to the public sector. Fraud is also the most common offence in the UK, accounting for approximately 41% of all crime[1]. The National Audit Office estimates that fraud and error cost the taxpayer between £55 and £81 billion in 2023/24 and that only a fraction of this is detected[2]. Financial loss due to fraud can reduce a council’s ability to support public services and can cause reputational damage.

2 Veritau delivers a corporate fraud service to the Council which aims to prevent, detect and deter fraud and related criminality. We use qualified criminal investigators to support departments with fraud prevention, proactively identify issues through data matching exercises, and investigate cases of suspected fraud. To deter fraud, offenders face a range of outcomes, including prosecution in the most serious cases.

3 This report provides the Committee with an update on counter fraud activity in 2025/26.

COUNTER FRAUD MANAGEMENT

4 A key objective for the counter fraud team is to raise the awareness of council employees to the fraud risks facing the council. In October we worked with the communications team to highlight the threats associated with cybercrime as part of cybersecurity awareness month. Employees were advised to:

· never open attachments or click links from unknown senders

· verify senders by checking email addresses carefully

· report any suspicious emails to the ICT team

· not reply or engage with scammers

· be aware that scammers will try to pressure employees into bypassing processes and internal controls.

5 A further campaign as part of Internation Fraud Awareness Week took place in November. This year’s message was about workplace fraud and how to report concerns to the counter fraud team.

6 The team also deliver targeted fraud sessions for individual service teams. In August, investigators led a session for officers working in the Council’s Direct Payments Team who work with service users receiving care and support budgets. Training focussed on examples of forged documents and the techniques to help identify them. An awareness session was also delivered to staff working in the Revenues service which examined local and national cases of interest.

7 Veritau continues to share alerts on fraud threats identified by partners in the counter fraud community, including the National Anti Fraud Network (NAFN). When the team identifies threats that could affect other local authorities, a threat report is made so all NAFN members are aware. Recent alerts from NAFN have included details of two bank accounts used by fraudsters who impersonate trusted council suppliers to divert payments, an individual using false documents to apply for Discretionary Housing Payments, and an organisation believed to be making FOI requests to councils in order to gather information to target the estates of individuals who are ill or have died intestate.

MULTI-AGENCY WORK

8 The National Fraud Initiative (NFI) is a large-scale data matching exercise that involves all councils and other public sector bodies in the UK. The work of the NFI is overseen by the Public Sector Fraud Authority (PSFA). Remaining outputs from the 2024/25 exercise are being processed by the counter fraud team and other services across the council.

9 Preparatory work is underway for the 2025/26 NFI Single Person Discount review. Each year, a mandatory exercise that compares households in receipt of a Single Person Discount to the Electoral Register is undertaken to identify properties with potentially undeclared occupants for council tax purposes. Data will be submitted to the NFI in December.

10 The counter fraud team works with other law enforcement agencies to tackle fraud committed against the Council. We regularly work with the regional Department for Work (DWP) investigation team in respect of residents who are awarded support by both the Council and DWP. There are a number of joint working investigation ongoing.

INVESTIGATIVE WORK

11 The counter fraud team has received 400 referrals for suspected fraud between 1 April and 26 November 2025. Each report is reviewed to determine the most appropriate response. We receive reports of potential fraud from Council officers, members of the public, and external agencies.

12 The team has concluded 49 cases and has 86 ongoing investigations. Warnings have been issued in seven cases where individuals had incorrectly received council tax discounts. Two applications for school places were also stopped. Our work also supported the recovery of a council property that had been abandoned. The property can now be allocated to someone on the Council’s housing waiting list.

13 As a result of our investigative work, Veritau has helped the Council to achieve £270k in savings to date. Counter fraud savings[3] are tracked by monitoring the actual repayments to the Council following fraud investigations and calculating the value of stopping ongoing fraud.

14 A summary of investigative work can be found in appendix A, below.

APPENDIX A: SUMMARY OF INVESTIGATIVE WORK 2025/26

The table below shows the success rate of investigations and levels of savings achieved through counter fraud work in 2025/26.

2025/26 actual

(to 26/11/2025)

2025/26 target

(full year)

Amount of actual savings (quantifiable savings - eg repayment of loss) identified through fraud investigation

£270,500

£225,000

% of investigations completed which result in a successful outcome (for example payments stopped or amended, sanctions, prosecutions, properties recovered, housing allocations blocked)

49%

30%

Caseload figures for the period are:

	2025/26 (at 26/11/2025)
Referrals received	400
Number of cases under investigation	86
Number of investigations completed	49
Number of verifications completed[4]	5

Activity	Work completed or in progress
Fraud detection and investigation	The service promotes the use of criminal investigation techniques and standards to respond to any fraud perpetrated against the Council. Activity to date includes the following: · Adult Social Care fraud – Four cases have been completed by the team to date, and nineteen cases are ongoing. Fraud in this area relates to deprivation of capital, financial abuse, direct payment fraud, and abuse of position (eg by a power of attorney). · Council Tax and NNDR fraud – Council Tax and NNDR fraud often involves false applications for discounts and exemptions from liabilities. The team has completed six investigations. In addition to amending bills, warnings were issued in two cases where discounts were incorrectly obtained. Twelve cases are ongoing. · Council Tax Reduction fraud – fraud can occur where someone claiming a reduction provides false information when they apply, or fails to declare a change to their circumstances relating to income, capital, or household occupation. The team has 33 ongoing investigations into claims in this area. Seven cases have been completed, and these have resulted in five people being issued with warnings. · External (or third party) fraud – fraud in this area can relate to financial crime or error perpetrated against the Council, eg mandate fraud, cybercrime, or supplier over charging. The team are currently investigating four possible frauds. · Housing fraud – cases investigated by the team relate to sub-letting and abandonment of council properties, and investigations into false applications to the Housing Register, Right to Buy, homelessness and mutual exchanges. There are three ongoing cases in this area. Six investigations have been completed into suspected subletting and applications for housing. In one case, a council property was recovered following a report of the property being abandoned. · Internal investigations – the team has completed 19 investigations, 15 of which resulted in information being provided to support services. There are 11 ongoing investigations. Cases in this area include matters raised under the Council’s whistleblowing policy. · Local assistance fund – this funding provides support for household goods and necessities to those in need. This area also includes Household Support Fund applications. The counter fraud team investigates the submission of fraudulent applications and misuse of the scheme. Four investigations are ongoing, and two investigations have been completed. · School admissions – we support Council officers to verify applications for school places where there is a discrepancy in home address records that affect school catchment areas. Five investigations have been completed this year. Two placements were stopped as a result of our findings, and three applications were upheld.

Activity

Work completed or in progress

Fraud detection and investigation

The service promotes the use of criminal investigation techniques and standards to respond to any fraud perpetrated against the Council. Activity to date includes the following:

· Adult Social Care fraud – Four cases have been completed by the team to date, and nineteen cases are ongoing. Fraud in this area relates to deprivation of capital, financial abuse, direct payment fraud, and abuse of position (eg by a power of attorney).

· Council Tax and NNDR fraud – Council Tax and NNDR fraud often involves false applications for discounts and exemptions from liabilities. The team has completed six investigations. In addition to amending bills, warnings were issued in two cases where discounts were incorrectly obtained. Twelve cases are ongoing.

· Council Tax Reduction fraud – fraud can occur where someone claiming a reduction provides false information when they apply, or fails to declare a change to their circumstances relating to income, capital, or household occupation. The team has 33 ongoing investigations into claims in this area. Seven cases have been completed, and these have resulted in five people being issued with warnings.

· External (or third party) fraud – fraud in this area can relate to financial crime or error perpetrated against the Council, eg mandate fraud, cybercrime, or supplier over charging. The team are currently investigating four possible frauds.

· Housing fraud – cases investigated by the team relate to sub-letting and abandonment of council properties, and investigations into false applications to the Housing Register, Right to Buy, homelessness and mutual exchanges. There are three ongoing cases in this area. Six investigations have been completed into suspected subletting and applications for housing. In one case, a council property was recovered following a report of the property being abandoned.

· Internal investigations – the team has completed 19 investigations, 15 of which resulted in information being provided to support services. There are 11 ongoing investigations. Cases in this area include matters raised under the Council’s whistleblowing policy.

· Local assistance fund – this funding provides support for household goods and necessities to those in need. This area also includes Household Support Fund applications. The counter fraud team investigates the submission of fraudulent applications and misuse of the scheme. Four investigations are ongoing, and two investigations have been completed.

· School admissions – we support Council officers to verify applications for school places where there is a discrepancy in home address records that affect school catchment areas. Five investigations have been completed this year. Two placements were stopped as a result of our findings, and three applications were upheld.

[1] Progress combatting fraud (Forty-Third Report of Session 2022-23), Public Accounts Committee, House of Commons, published March 2023.

[3] Counter fraud savings consist of money recovered during the course of the year (debts may have been calculated in previous years as well as the current financial year), the value of applications that would have been successful, eg Right to Buy, and 12 months of savings where an ongoing fraud has been stopped through the work of the counter fraud team.

[4] Verification cases are reviews of applications for school placements.