DWP to check bank accounts for two things when it comes to benefit fraud

The Department for Work and Pensions (DWP) will be keeping an eye out for two key elements when it gains fresh powers to inspect bank accounts for potential benefit fraud. One of the contentious steps being introduced is granting DWP investigators the authority to delve into claimants’ bank accounts.

This tactic, dubbed “Third Party Data Gathering”, aims to detect if any individuals are deceiving the benefits agency regarding their income or savings, rendering them unfit to claim. Under present Universal Credit stipulations, if you have more than £16,000 across cash, savings and investments, you’re not eligible for the assistance.

Maintaining this as its “main priority”, the DWP will also watch for those spending more time abroad than allowed by the rules, reports Chronicle Live. A fresh amendment to the bill – currently en route to the House of Lords – obliges banks to oversee customers receiving these benefits and inform the DWP if an account exceeds the capital threshold or has been used overseas for over four weeks.

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According to a recent heads-up by the DWP, it will monitor accounts from the UK’s top 15 banks, accounting for 97 per cent of benefit claimant’s bank accounts. This includes banks like Bank of Scotland, Barclays, Halifax, HSBC, NatWest, Santander and TSB.

The DWP has confirmed that each identified claim will be investigated as standard, stressing that penalties will not be handed out automatically. In a recently published assessment document, the DWP assured there will be no “automatic decisions” made solely based on data.

Instead, caseworkers will take into account potential vulnerabilities of claimants, ensuring automation is exercised responsibly. Within the same assessment document, it mentioned: “(This) measure can potentially include vulnerable people, (and) these areas will be explored further in the equality impact assessment.

“We are clear, however, that no automatic decisions will be made based on data alone, and DWP staff will follow the usual business processes when looking into any cases, taking account of circumstances and wider vulnerabilities before deciding on a course of action.”

A representative from DWP added that these measures were primarily focused on areas such as Universal Credit, where fraud and error rates are highest. The spokesperson clarified: “These changes will not allow DWP direct access to bank accounts, but will require third parties to share data signaling fraud with us so it can be considered further. It will also help identify people who have made a genuine mistake with their claim, preventing them from potential debts.”

These new measures originally featured in the 2022 policy paper titled “Fighting Fraud in the Welfare System”, which can be found here.