Source · Select Committees · Public Accounts Committee
Recommendation 14
14
The Department has not identified what types of fraud it will prosecute, with the Department...
Conclusion
The Department has not identified what types of fraud it will prosecute, with the Department suggesting there is a range of criminality in fraud; it has euphemistically referred to ‘hard’ and ‘soft’ fraud.34 Hard fraud refers to a type of fraud committed by criminal organizations with the intention to defraud an organization. Soft fraud consists of borrowers exaggerating otherwise-legitimate claims, such as overstating turnover in order to receive a larger loan. We are is not convinced that this definition sufficiently answered the question regarding the counter-fraud protocols and the need for additional legislation to tackle fraud.35
Government Response
Not Addressed
HM Government
Not Addressed
4: PAC conclusion: Government’s plans for managing risks to the taxpayer—from both fraud and borrowers who are unable to repay loans—are woefully under-developed. 4a: PAC recommendation: The Department needs to provide clear updates on how it intends to deal with different cases of fraud, including on how it will prioritise recovery and prosecution. 4.1 The government disagrees with the Committee’s recommendation. 4.2 The government agrees that different types of fraud will require different approaches in terms of recovery and prosecution. The department is working constructively with lenders, other government departments and law enforcement colleagues on its counter fraud approach. However, the government does not intend to make public the detail of its approach to recovery and prosecution in different fraud cases, given this could inadvertently undermine the effectiveness of counter-fraud measures by tipping off criminals. Decisions on individual prosecutions are taken independently of government by the Crown Prosecution Service.