Fraud in Furlough Scheme
HMRC has received 1,868 reports of fraudulent use of the Coronavirus Job Retention Scheme to its digital reporting service (as of 29 May 2020).This is more than double the number of reports it received as of 12 May (795).
Whistleblowing charity Protect says that 36% of its Covid-19-associated calls involved furlough fraud. It has identified three main types of fraud:
- A company furloughs staff but asks them to continue to work or volunteer unpaid.
- Companies furlough staff without telling them. The workers only find out when they are paid.
- A company claims furlough money for a ‘ghost’ employee who may be someone they dismissed or ‘recruited’ so they could claim the money.
The number of employees to be placed on furlough since the scheme began is now 8.7 million, across 1.1 million employers, according to Treasury figures issued this week.
An HMRC spokesperson told HR website Personnel Today that fraudulent claims for furlough limit the government’s
“ability to support people and deprive public services of essential funding. We’d ask anyone concerned their employer might be abusing the scheme to please contact us. It could be that you’re not being paid what you’re entitled to, they might be asking you to work while you’re on furlough, or they may have claimed for times when you were working. These reports are just one way that HMRC identifies fraud. Claims are checked and payments may be withheld or need to be repaid if the claim is based on dishonest or inaccurate information. We won’t hesitate to take criminal action against the most serious cases.”
The spokesperson added: “We’re not trying to catch people out – if it turns out to be a genuine mistake then we’ll help put it right, and if it’s more serious then we’ll step in.”