An anti-fraud squad will be given the power to raid the properties of Covid fraudsters and recover taxpayers’ money from their bank accounts.
The new measures, which will be introduced to parliament on Wednesday as part of the fraud bill, will give the Cabinet Office’s Public Sector Fraud Authority the means to issue civil penalties to provide an alternative to criminal prosecution, which would be applied retrospectively.
The government is seeking to bolster the Covid corruption commissioner’s ability to investigate suspected fraud cases, including those unrelated to the pandemic where people are suspected of defrauding the government, such as fake companies getting taxpayer-funded grants.
In the lead-up to Christmas, the chancellor, Rachel Reeves, appointed the health service veteran Tom Hayhoe, a former Conservative cabinet adviser, as her Covid corruption commissioner on a one-year contract. He had been expected to receive assessments of fraud recovery work that has taken place to date in other major Covid loan schemes such as furlough, business support grants and Covid-era universal credit fraud.
A Labour source said: “The Tories turned a blind eye to Covid fraud. We will get back taxpayers’ cash so that we have more money to spend on public services including the NHS.”
The authority will be able to use strong civil penalties to provide an alternative deterrent to criminal prosecution. The time limit to bring civil claims against fraudsters will be extended from six to 12 years.
The PSFA will get the power to compel companies and individuals to hand over evidence, and apply for court warrants such as search warrants to seize evidence and take money directly from the bank account of fraudsters.
The Cabinet Office minister Georgia Gould said: “During the pandemic, when people and businesses needed government support the most, some people stole public money for their own personal gain. This legislation gives the government tough new powers that can be used to investigate and recover money stolen from the public during Covid and doubles the time we have to bring fraudsters to justice.”
