UK’s biggest Universal Credit fraud gang ran ‘benefit factories’ in £50m scam

Britain’s biggest benefit fraud gang, which committed “fraud on an industrial scale” against the welfare system, has been convicted of a £50m Universal Credit plot. The Bulgarian gang falsely claimed more than £50m in Universal Credit to spend on luxury goods in England and Wales’ biggest benefit scam.

Five Bulgarian nationals Galina Nikolova, 38, Stoyan Stoyanov, 27, Tsvetka Todorova, 52, Gyunesh Ali, 33, and Patritsia Paneva, 26, pleaded guilty to fraud and money laundering offenses at Wood Green Crown Court for their involvement in the multi-million pound scam.

The CPS successfully prosecuted the five defendants following a detailed and comprehensive investigation by the Department for Work and Pensions (DWP). All five defendants will be sentenced in May 2024.

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Between October 2016 and May 2021, the organized crime group made thousands of false claims for Universal Credit using either real people or hijacked identities.

These claims were supported by falsified documents, including fictitious leases, fake payslips and forged GP and landlord letters. If the claims were denied, the band would persist until they were granted.

They created “benefit factories” in London, set up under the pretense of helping people with genuine claims. However, it was found that after claimants made their claims for benefits through these factories, they then left them in the hands of the organized crime group.

The money earned from the fraudulent claims was then laundered as it was moved between multiple accounts through numerous transfers and cash withdrawals.

All five defendants were first arrested on 5 May 2021 and a number of properties were searched. Police found hundreds of “claim packs” with false and fake documents, as well as wads of cash stuffed into shopping bags and suitcases.

They also found a luxury car and designer goods including watches, jackets and glasses.

Following his release under investigation, one of the five defendants, Ali, fled the country to Bulgaria. Ali was extradited back to the UK on 25 February 2023 to face justice.

The CPS said that when faced with the large amount of incriminating evidence including encrypted messages, CCTV footage, forged documents, seized digital devices and bank statements, the defendants eventually pleaded guilty.

Ben Reid, specialist prosecutor for the CPS, said: “This case is the biggest prosecution for benefit fraud ever brought before the courts in England and Wales.

“Over a number of years, these defendants conspired to commit fraud on an industrial scale against the Universal Credit system, costing the taxpayer more than £50 million.

“By making thousands of false claims, organized criminals have enriched themselves from government funds meant to protect and help the most vulnerable people in our society.

“This was a complex and challenging case which required close and effective collaboration between CPS prosecutors, the Department for Work and Pensions and our international partners both in Bulgaria and through Eurojust’s UK office to break down and to successfully pursue the organized crime group.

“The guilty pleas entered by all five defendants reflect the strength of the evidence against them.

“The CPS Proceeds of Crime Division and the DWP will now proceed with confiscation proceedings against the defendants to strip them of any criminal benefit available from this enterprise.”

Mel Stride MP, Secretary of State for the Department for Work and Pensions, said: “I am extremely proud of the work of DWP investigators, in conjunction with the Crown Prosecution Service, to take down this organized crime group.

“Today’s convictions underline our commitment to protecting taxpayers’ money and it is right and just to bring those who steal from the public purse to justice. My message is simple – if you are committing benefits fraud, you are cheating the taxpayer and we will catch you.”