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£8m of Fraud and Overpayment Detected in Wales

£8M O Dwyll A Gordaliadau Wedi’u Canfod Yng Nghmru Trwy’r Fenter Twyll Genedlaethol



The latest National Fraud Initiative (NFI) exercise has uncovered £8 million of fraud and overpayments across public services in Wales, compared with £5.4 million in the previous exercise.

The Auditor General’s report, published today, reveals that more than £42.9 million of fraud and overpayments have been found in Wales since the NFI began in 1996.

NFI is carried out every two years, matching data between organisations, systems and across national borders to help public bodies identify potentially fraudulent or erroneous claims and transactions. Data submitted by Welsh bodies for the 2018-2020 NFI exercise helped other organisations in other parts of the UK identify 94 cases of fraud and error amounting to £125,000.

The additional £2.7m found in fraud and overpayments in the 2018-20 round was mainly due to several local authorities being more proactive in reviewing matches between the council tax single persons discount and the electoral register.This information was then used to cancel ineligible claims.

The report also highlights that the COVID-19 pandemic has significantly increased the risk of fraud as public bodies have needed to urgently process COVID-19 support payments in very difficult circumstances.The Auditor General is working with the Cabinet Office to identify, develop and promote data matching facilities to help address some of this increased fraud risk.  Facilities to allow councils to carry out additional checks on bank accounts and company status in relation to business support grants have been made available to Welsh NFI participants. The Auditor General has included data-matching COVID-19 business support grants paid by local authorities as part of the 2020-2022 NFI to help Councils identify fraudulent applications for support.

Although most Welsh NFI participants display a strong commitment to counter fraud and to investigating NFI matches, the report highlights that some participants could be far more proactive. Some local authorities reviewed very few of the matches they received, and as a consequence did not do sufficient work to address potential frauds.

There are seven main areas which generated almost 98% of the fraud and overpayments identified these include; council tax discount, blue badges, housing benefit, pensions, waiting lists, residential care homes and council tax reduction schemes. The report highlights three case studies which focus on some of these areas from a number of local authorities.

Auditor General, Adrian Crompton said today:

“The COVID-19 pandemic has brought significant challenges for public sector organisations who continue to deliver services for individuals, communities and businesses in an extremely difficult time. So identifying £8 million in this latest NFI exercise is an important contribution to public service funding across Wales. It is more important than ever that organisations have sound governance and controls in place to help protect vital services from the risk of fraud at this time of crisis.”