Almost £400m was stolen from the UK government’s Covid support schemes by organised crime gangs, according to new figures released by Whitehall.
Figures released by HM Revenue and Customs, after a Freedom of Information request by law firm Pinsent Masons, showed £367m was stolen from initiatives like the furlough scheme and Eat to Help Out.
The government’s near £400bn in Covid spending was “a bonanza for organised crime gangs”, according to Pinsent Masons partner Andrew Sackey.
Almost £6bn was lost to scammers through three Covid schemes – the furlough scheme, the self employment income scheme and Eat to Help Out – while another £5bn was lost through the Bounce Back Loan scheme.
The Bounce Back Loan scheme saw banks hand out £47bn to businesses, with the government taking on 100 per cent of the default risk, with virtually no checks required.
The new figures showed the scheme most exploited by organised crime gangs was the Self-Employed Income Support Scheme (SEISS).
Sackey said “the barriers to making a fraudulent claim under the SEISS scheme were much lower than for furlough or Eat Out to Help Out” as fraudsters did not need to create a fake business.
The UK’s fraud minister Lord Theodore Agnew resigned in February out of frustration with the government’s inaction on Covid fraud, telling a Westminster committee that the episode was “one of the most colossal cock-ups in recent government management”.
HMRC was contacted for comment.