The Department for Work and Pensions (DWP) is set to intensify its scrutiny on four types of benefits as part of a fraud clampdown amidst the ongoing Cost of Living crisis. Under the stewardship of the new Labour Party government, the DWP will be endowed with enhanced powers.
In an effort to combat fraudulent claims, DWP officials are poised to conduct bank account inspections, reports Birmingham Live. Financial expert Steven Kibbel from Gold IRA Companies said: “I believe these new powers to check claimants’ bank accounts will primarily target means-tested benefits.
“Universal Credit is likely to be a major focus, as it’s one of the most widely claimed benefits and has a savings limit of £16,000. Other benefits that could be subject to these checks might include Jobseeker’s Allowance, Employment and Support Allowance, and Housing Benefit.
“The Government seems particularly interested in identifying those who might be claiming benefits while having savings above the threshold or those who are spending extended periods abroad, which could affect their eligibility.”
Meanwhile, financial advisor Yiannis Zourmpanos, a senior contributor at Bountii, expressed concerns about privacy, stating: “The idea that the Government can peer into your bank account feels invasive, and I understand why. From a financial perspective, this kind of oversight raises ethical issues.
“But remember, it’s also a balancing act. The DWP is trying to ensure that public funds are being properly allocated, and they’re arguing that the level of fraud demands a tougher stance.”
He cautioned: “What’s worrying is that legitimate claimants-people who rely on these benefits to get by-could get swept up in this if their situation looks questionable on paper.”
“I’ve seen how quickly things can spiral in the world of finance when things don’t add up, even if there’s a reasonable explanation. People who are already in vulnerable financial positions often don’t have the resources to defend themselves against these kinds of inquiries.”
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He further explained: “To get more specific, banks are now required to report certain financial patterns, like unexpected large deposits or recurring transfers that don’t match a person’s declared income. That’s not to say you’ll be flagged every time your situation changes, but it’s worth being cautious. I’ve had clients before who were questioned about receiving financial help from family members, and while everything was legitimate, it still took time and effort to clear things up.”
He advised: “Keep detailed records of your income, savings, and any changes in your circumstances. It’s crucial to report any changes promptly to the Department for Work and Pensions. This includes new jobs, changes in working hours, or alterations to your living situation. If you’re planning to travel abroad, make sure you’re aware of the rules regarding how long you can be out of the country while still claiming benefits.”
“Don’t hesitate to seek advice if you’re unsure about any aspect of your claim. There are many welfare rights organizations and advisors who can help you understand your entitlements and obligations.”