Two arrested on suspicion of furlough fraud after £700k claimed in warning to employers


Furlough fraud is a term used to define individuals who break rules laid out under the scheme designed to help those affected by the coronavirus crisis. Otherwise known as the Coronavirus Job Retention Scheme (CJRS), furlough has helped over 9 million people, some of whom may have lost their jobs otherwise. Original rules of the scheme outlined that employees would receive 80 percent of their salary from the government while on furlough.

In exchange they were not permitted to work for their employer, alongside other rules laid out. 

But HMRC has now confirmed two people have been arrested on suspicion of furlough fraud of up to £700,000.

HMRC officers attended residential addresses in the London areas late last week to investigate the issue further.

A 43-year-old male accountant from Romford was arrested on suspicion of fraud by false presentation, fraud by abuse of position and money laundering.

READ MORE: Furlough fraud: People who exploit scheme urged to come clean

Terry Braithwaite, Assistant Director at HMRC’s Fraud Investigation Service commented on the scheme.

He said: “The CJRS is part of the collective national effort to protect jobs. While most employers have used the scheme responsibly, this is taxpayers’ money and HMRC will not hesitate to act on reports of abuse of the scheme. 

“Anyone who is concerned their employer has abused the scheme should report it to HMRC on gov.uk or by calling our fraud hotline line 0800 788 887.”

Under the CJRS scheme, more than £35.4billion has been paid out to support millions of people across the country.

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Recently, the Revenue warned it is ready to crack down on the matter through in-depth post-payment investigations.

While the vast majority have been adhering to the rules, there have been some unscrupulous individuals looking to exploit the scheme for their own gain.

And while HMRC was not legally allowed to carry out investigations into suspected CJRS fraud until the Finance Bill was granted Royal Assent, it now has the green light to investigate the issue. 

The Revenue has, so far, received more than 8,000 calls relating to potential CJRS fraud.

It believes the level of error and fraud could range from five to ten percent in total, but that compliance efforts would help to bring this estimate down. 

In a statement, HMRC said: “We evaluate every piece of intelligence we receive and will follow up where there is any indication of wrongdoing.

“We encourage anyone who suspects deliberate fraud to contact our fraud hotline services.”

Jim Harra, the chief executive of HMRC, previously stated it was highly likely the scheme would be exploited – by both employers and organised criminals. 

But Mr Harra also said HMRC had struck an appropriate balance between protecting the Treasury from abuse, and providing help to those who need it as quickly as possible. 





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