DWP complaint
Processing and issuing of UC advance payments
49. Mrs X is concerned DWP processed two of her daughter’s UC claims, dated 18 July and 21 August 2019, and issued her with an advance payment even though the claims had been made fraudulently. Mrs X feels DWP’s processes and procedures should not have let this happen.
50. We understand DWP records show Miss X made UC claims on 18 July and 21 August 2019. We have learned Miss X received her advance payments for these claims on 23 July and 21 August 2019. The advance payments totalled £3,050.88.
51. DWP has said at that time, if a UC claimant submitted a complete online application and had their identity verified, their bank details checked using Bank Wizard (software designed to validate and verify bank account details) and their National Insurance number verified against DWP records, awards were automatically calculated based on the information declared in the application. As this applied to Miss X’s case, DWP made advance payments directly to her based on the information provided. This is in line with the processes described in DWP’s ‘Decision makers’ guide’, 2013, and the Universal Credit Regulations 2013.
52. We therefore understand the first claim was opened on 18 July 2019 and closed on 21 August 2019. DWP has told us this is case closure policy guidance. It states: ‘If a claimant fails to book their IEI, their claim remains open for 1 calendar month from the date of their declaration. The claimant is automatically prompted 7 days after the date of declaration to book their appointment. If no further contact is made, the claim is closed 1 calendar month from the date of their declaration.’ We therefore consider DWP followed its own guidance by closing the claim one month after it was first made.
53. DWP received the second online claim, dated 21 August 2019 and apparently from Miss X, but closed it on 26 September 2019 after she failed to book an IEI. This is again in line with the DWP guidance stated above.
54. We therefore see no evidence DWP was responsible for a fault or service failing. It appropriately processed both of the UC claims made in Miss X’s name, in line with its own policy. It also made advance payments based on the information it held. There is no evidence to suggest DWP was aware these claims could potentially be fraudulent or that it should not have processed the claims at the time.
55. We have thought carefully about Mrs X’s belief DWP should never have processed or approved the UC applications made in her daughter’s name, given that she is vulnerable and has learning difficulties. DWP said the first time it learned of Miss X’s vulnerabilities was when Mrs X advised Debt Management of this on 9 September 2019. We have seen no evidence DWP knew of Miss X’s vulnerabilities before approving the UC claims. We also know this was the first time Miss X had applied for benefits.
56. We understand if Mrs X wanted to act as an appointee for her daughter, she would need to apply for this and attend an interview with DWP. This is explained in the online guidance on becoming an appointee. However, we have seen no evidence Mrs X ever applied, or that DWP made her Miss X’s appointee. If DWP had made Mrs X an appointee, it would not have allowed Miss X to accept her Claimant Commitment or to apply for UC for herself. Instead, Mrs X would have had responsibility for this. DWP cannot treat Mrs X as her daughter’s appointee if Mrs X has not applied for this.
57. We understand Mrs X is very frustrated her daughter was allowed to apply for UC and have it approved. Having explored this matter, we see no evidence DWP knew of her daughter’s learning difficulties before 9 September 2019. We also note there was no mention of illnesses, disabilities or ongoing health conditions in Miss X’s UC application forms. There is therefore nothing to suggest DWP should have acted differently at the time or altered its standard UC application process.
58. DWP responded to Mrs X’s complaint that DWP’s systems should not even have approved her daughter’s claim for UC. It assured us it is aware of: ‘fraud and takes precautions to prevent fraudulent claims. However, Miss X had given sufficient information to the people making the claim that they were able to pass security checks. It is unlikely this would have been possible without her cooperation.’
59. Our ‘Principles of Good Administration’, 2009, say: ‘Public bodies should provide effective services with appropriately trained and competent staff. They should plan carefully when introducing new policies and procedures. Where public bodies are subject to statutory duties, published service standards or both, they should plan and prioritise their resources to meet them.’ We consider DWP has kept to this by taking precautions to prevent fraud and maintaining security checks.
60. We are therefore satisfied DWP has systems in place, including an appointee scheme, that would protect vulnerable people against any potential fraud. Unfortunately, in Miss X’s case, DWP had no reason to suspect fraud at the time, as the claim had passed security and did not flag that Miss X was in any way vulnerable. DWP can only work with what it knows at the time.
61. We also note while Mrs X feels DWP’s systems should have prevented her claim from being processed, DWP had no control over the money once it was in the claimant’s bank account. The money was only lost to Miss X and DWP once Miss X had been persuaded to transfer it to the fraudsters.
62. The above does not diminish the fact a third party has manipulated Miss X and treated her very badly. In our view, the responsibility for defrauding Miss X lies solely with the third party who did so, and not with DWP.
Request to repay advance payments
63. Mrs X is unhappy that although the claims were made fraudulently, DWP still seeks repayment from her daughter.
64. Following the closure of both these claims, details of the advance payments were sent to Debt Management. DWP said: ‘When a claim is closed with an outstanding balance in debit (e.g. due to an advance payment which has not been fully repaid), the balance can obviously no longer be recovered from monthly Universal Credit payments, so the details have to be sent to Debt Management to arrange repayment’.
65. We can see the correct process was followed, in line with DWP’s ‘Benefit overpayment recovery guide’, 2017, sections 5.101 to 5.104. Miss X received advance payments, and as the claim was closed, there was no other way for DWP to recover this money via other benefits.
66. DWP added: ‘The referral and recovery processes are automated, therefore when the overpayment is referred to Debt Management, if the customer is in receipt of benefit, deductions will be implemented. If not, then the off-benefit recovery process applies. Debt-Centre-Guidance (via the intranet) states the following.
• Where a prescribed benefit is being paid, it is Debt Management policy to implement compulsory deductions from that benefit to repay a debt. The recovery process is managed by Debt Manager’s on benefit processes.
• However, where a customer is no longer in receipt of a prescribed benefit, the case must be transferred for recovery via an off-benefit strategy.
• Once we are notified that a customer is no longer on benefit, Debt Management attempts to contact the customer using letters and telephone.
• The aim is to secure payment in full, or to negotiate a mutually agreeable off-benefit instalment plan with the customer.’
67. We understand Mrs X contacted Debt Management on 9 September 2019 and reported Miss X may have succumbed to fraud. Mrs X explained when her daughter received the advance payments, she then paid most of the money to the fraudsters. DWP’s ‘Universal Credit Advances’ guidance, 2013, state when DWP receives such a report, it should complete an Advance Misuse Referral form.
68. We understand DWP made this referral over a month after Mrs X contacted DWP to report the issue. We see according to its policy, DWP should have made the Advance Misuse Referral sooner. Yet it did ultimately make the fraud referral, the recovery of advance payments continues pending investigation of the fraud, and the referral had no impact on the case. We therefore do not consider DWP’s actions amount to a fault.
69. DWP advance payment guidance says:
‘The Secretary of State has an obligation to protect public funds and to ensure that, wherever possible, an overpayment is recovered.’ The guidance goes on to say: ‘Universal Credit Advances are treated as an overpayment for recovery purposes if the Universal Credit award ceases or does not become payable’. Therefore, as DWP treated the advance payments as overpayments pending a decision on the fraud investigation, it was correct to continue requesting overpayments.
70. We are aware Mrs X remains very frustrated DWP still seeks to recover the overpayment despite her having informed DWP of the situation by letter and telephone. The above guidance notes while a potential fraud case is investigated, recovery of overpayments will continue. If the fraud investigation finds repayment is not necessary, any such payments made will be reimbursed to the claimant.
71. We understand both Mrs X and her MP contacted DWP again, and DWP then made a referral to CFCD on 19 December 2020. We understand CFCD wrote to Miss X on that day asking her to contest the repayment decision or to explain how the overpayment arose.
72. We understand CFCD gave Miss X and Mrs X 30 days to provide this information. As CFCD did not receive a response, it had nothing to investigate and so closed its investigation. This was detailed in the letter to Mrs X in its letter dated 19 December 2020.
73. Mrs X told us she did not respond to the above letter because it was not signed and did not appear professional.
74. On 5 March 2021, CFCD added it would be difficult for DWP to identify the potential fraudsters, based on the information they had. It added if the fraud had been reported to the police, then a crime reference number would factor into the investigation.
75. We can see there is nothing to suggest DWP failed to follow its own policies and guidance. When DWP closed both UC claims, it correctly forwarded Miss X’s information to Debt Management. This was because she had received advance payments that Debt Management needed to recover. When DWP made the fraud referral, CFCD took over the matter. This gave Mrs X and Miss X a clear opportunity to explain why CFCD should not recover the payments. As they did not respond to the letter dated 19 December 2020, there was nothing more it could do at that time. Debt Management therefore continued to request repayments.
76. We understand Mrs X feels she has already provided information to DWP about who the fraudsters were and finds it frustrating that the relevant departments did not share this information. We are aware Mrs X told the fraud line during a telephone call on 9 September 2019 she had obtained the names, email address and telephone numbers of the people involved.
77. However, we have seen no evidence Mrs X supplied this information to any department within DWP. CFCD therefore had limited information with which to investigate the potential fraud and felt it had to close the case.
78. The CFCD guidance says it:
‘will only close a case where there is a successful outcome (i.e., prosecution or an administrative penalty) or if there is insufficient evidence to obtain a successful outcome. If a suspect withholds information the investigator will look to see if it can be obtained by other means (e.g. bank statements or employment details).’
79. When DWP passed Miss X’s fraud claim to the specialist team, the latter did not have the information it needed. As no one supplied the information needed, the specialist team could not continue its investigation.
80. We can therefore see no fault in this part of Mrs X’s complaint.
81. DWP confirmed to us it did then agree to investigate following Mrs X’s complaint and discussions with ICE. As a result, DWP waived £1,800 of the total amount it paid to Miss X, which is the amount Miss X paid to the fraudsters.
82. We understand ICE shared this information with Mrs X in its report. From our enquiries, we understand DWP awaits action that will allow it to process the waiver. It will then write to Mrs X with more details.
83. DWP worked with ICE to reach a customer-focused outcome. It also agreed to write off the part of the debt that was taken from Miss X fraudulently. We therefore think DWP acted in line with our ‘Principles of Good Administration’, 2009. These say: ‘Public bodies should treat people with sensitivity, bearing in mind their individual needs, and respond flexibly to the circumstances of the case. Where appropriate, they should deal with customers in a co-ordinated way with other providers to ensure their needs are met’.
84. If Mrs X continues to believe Miss X should not repay the rest of the overpayment, which she retained, Mrs X will need to take this up with CFCD. Given the above, we can see no signs DWP was at fault.
Communication
85. Mrs X complains about the service she received from DWP. She alleges correspondence went unanswered, she was passed around during telephone calls and was unable to speak to the same person. Mrs X adds she never got to speak to anyone by telephone as she could not answer the security questions. She says she has not heard anything from DWP since 24 January 2022.
86. ICE’s Report said: ‘It is clear that DWP failed to respond to the correspondence you sent in October and November 2019 and they also delayed responding to your MP’s correspondence in November 2020. Furthermore, they failed to explain how UC advance payments were made on two occasions […]’ ICE’s Report continued: ‘As a result of our examination of your complaint, I recommend that DWP apologise to you for the service failure identified in this report […]’.
87. We agree with ICE’s conclusion that the evidence available shows DWP provided poor customer service. Based on all the evidence available to us, we can see DWP failed to respond to correspondence Mrs X sent to it on 5 October 2019 and 19 November 2019. We understand she requested information and call-backs in her letters, and DWP did not respond.
88. DWP’s Charter says: ‘We will:
• deal with your request the first time you contact us, or as soon as we can • tell you what will happen next, and by when • keep you updated of progress’.
It adds, ‘You can trust us to do what we say we will do’.
We can see DWP did not follow its own guidance in this part of the complaint.
89. We can also see this caused Mrs X and Miss X stress and frustration at not being able to communicate with DWP or get the information they needed.
90. When we can see that a party is at fault and this has impacted on a person, we use our Severity of Injustice scale. It allows us to make sure the recommendations we issue are consistent and transparent.
91. Level one on the scale says: ‘A case will generally be level one if we consider the person affected has experienced a low impact injustice such as annoyance, frustration, worry or inconvenience. This would typically arise from a single (one-off) incidence of maladministration [fault] or service failure, where the effect on the person complaining is of short duration, and where there are no other adverse effects or ongoing wider impact. We will usually consider an apology to be an appropriate remedy for these cases’.
92. We understand ICE recommended DWP offer an apology for its fault, and DWP wrote to Mrs X on 24 January 2022 accepting its failings and providing an apology. In relation to this part of the complaint, we therefore consider DWP did enough to put things right and follow our guidance.
93. We recognise Mrs X’s inability to speak to anybody, as she could not pass security, will have caused her frustration. As DWP would have disclosed sensitive information in the conversations, we consider it was necessary that she pass security.
94. DWP’s relevant policy here is its ‘Working with representatives: guidance for DWP staff’, 2021. It says sensitive information can be disclosed to another party in the following circumstances:
‘You can disclose information where: • you have current written signed authority from the customer • the customer is present to confirm their permission (including at the end of a phone) • where alternative enquiry is established.’
95. We do not have access to the recorded telephone calls as they no longer exist. Mrs X tells us she could not answer the security questions. DWP has not disputed it refused to answer her questions on this basis. We therefore have no reason to doubt these events took place. Since it was not possible to meet the above criteria, and Mrs X could not pass security, we consider DWP acted appropriately and followed its own guidance in not disclosing any more information to Mrs X.
96. We are aware Mrs X’s experience of being passed around during telephone calls and unable to speak to the same person will have caused her great frustration. Due to the size of the organisation, it is not always possible to speak to the same person. There is nothing in DWP’s policy and guidance specifying a single member of staff must speak to a given claimant. We understand when it investigated the later complaint, DWP gave Mrs X a complaints manager to contact directly.
97. DWP’s Charter says where appropriate it will, ‘explain clearly how to contact us in other ways’. We consider DWP followed its own guidance by providing Mrs X with details of a complaints manager to contact for any update requests or questions she had.
98. We have been in contact with DWP regarding Mrs X’s concerns that DWP has not contacted her about the fraud investigation or repayment. DWP has requested Mrs X contact it directly with any queries. It has also given us a telephone number, which we will provide to her.
99. We cannot therefore see any signs DWP was at fault or failed to act in line with its Charter.
Complaint regarding ICE
100. Mrs X feels ICE’s investigation was biased and favoured DWP. She believes ICE did not consider all the evidence she submitted.
101. On the latter point, we can see ICE’s policy states, ‘Please let us know within 3 months if: • you are unhappy with the outcome, and • you have new evidence that you think would materially affect it or which shows that it contained a factual error’.
102. We understand Mrs X went back to ICE on receiving its report as she was unhappy with its findings. ICE did not change its findings, as Mrs X did not provide any information new to ICE or that showed it had made a factual error. ICE explained at the end of its report it would only review its findings in those circumstances. Its findings therefore remained unchanged.
103. Based on the information we have seen, we consider ICE acted in line with its policy by not reconsidering Mrs X’s complaint. The evidence available to us shows she did not provide any new evidence that would affect ICE’s findings, and not simply restate the main points of her complaint. This tells us ICE did not fail to consider the evidence Mrs X had provided. Instead, ICE considered it but did not reach the conclusion Mrs X wanted.
104. Regarding ICE’s Report being biased, the ICE website explains: ‘[ICE] acts as an impartial referee for people who: • feel they have been treated unfairly • are unhappy with the way their complaint has been dealt with’.
We therefore expect any findings to be impartial and evidence based. Our ‘Principles of Good Complaint Handling’, 2009, also state organisations should, ‘Investigate complaints thoroughly and fairly, basing their decisions on the available facts and evidence, and avoiding undue delay’.
105. Having considered ICE’s Report, we can see ICE obtained full case notes, information from telephone calls, and letters from DWP and Mrs X in order to investigate this complaint. This is the relevant evidence we would expect in this case. Where evidence was not available, ICE duly recognised those gaps.
106. We have seen no evidence to suggest ICE sided with DWP and acted unfairly to Mrs X and Miss X. We therefore consider ICE looked at all available evidence and based its findings on what it saw. We have seen no signs ICE acted in a biased way or failed to look at all available evidence. We therefore see no signs of fault in its investigation of Mrs X’s concerns.
107. Having considered the above very carefully, we have decided to take no further action in this complaint. We recognise Miss X and Mrs X have had a very difficult experience, and their interactions with DWP have caused them frustration. We hope the explanations set out above are helpful to them in understanding how we reached our decision in their case.