Callcredit urges a number of London Boroughs to use ‘carrots and sticks’ to eradicate tenancy fraud
One in every twenty five social houses in London is being illegally sublet and Callcredit Information Group is urging a number of London Boroughs to use both 'carrots and sticks' to stamp out this type of tenancy fraud.
Due to become a criminal offence in the summer, tenancy fraudsters are keeping deserving families out of their rightful homes and on social housing waiting lists for longer than necessary. The combined national waiting list tops 1.8 million households. The Government has recently allocated £9.4million to help local authorities tackle social housing fraud and Callcredit is urging many London Boroughs to start now if they want to stamp out tenancy fraud.
However one leading London Borough has already begun to improve its fraud detection rates significantly, through the use of external data sources provided by credit reference agency Callcredit Information Group, and has recovered 81 properties at a saving of £54k each, enabling those in the greatest housing need to move in. Blocked two right to buy applications due to tenancy fraud at a saving of £75k each and has helped the Borough to save in total over £4.5m to date.
Callcredit also recently wrote to a number of London Borough MPs to make them aware of the scale of the problem highlighting that "fraud and error… costs councils…an estimated £2.8 billion a year and is especially prevalent in London".
Commenting on the initiative, Andrew Davis, Director of Public Sector at Callcredit said: "The Government is clearly applying carrots - in the form of grants - and sticks - in the form of new legislation that makes it illegal to sublet a social home. Several London local authorities are now working with us to build a dedicated 'fraud hub' that will share data and so help further improve detection rates, however more can be done.
"Our own research* has revealed that there were 28,000 cases of tenancy fraud committed in local authority housing stock in 2011; despite this, detection rates amongst local authorities are below 10% and 85% of all councils have no dedicated tenancy fraud strategy or dedicated fraud team in place; this despite the fact that the Government says they should have. So there is a significant way to go."
Council tax benefit fraud is also especially acute in London and of the ten English councils owed the most money, half of them are London Borough councils. Not only is Callcredit helping local authorities stamp out tenancy fraud it is also helping them to collect outstanding council tax too. Through the use of external data sources provided by Callcredit, London Borough of Hillingdon has traced £800,000 in outstanding council debt of which £135,000 has already been collected.
* 'Shutting the door on Tenancy Fraud' is a white paper published by Callcredit. Copies can be obtained by visiting the company's website