Part of the joint strategy between the Department for Work and Pensions, Local Authorities and Her Majesty’s Revenue and Customs to tackle fraud and error in the benefits and tax credits system introduced new Loss of Benefit (LOB) penalties from 1st April, 2013. These new penalties supplement the current One/Two strike LOB regime for offences that occur wholly on or after 1st April, 2013.
The amended rules introduce 5 levels as follows:
- Level 1 – Offences which result in an Administrative Penalty (Ad Pen) or caution will continue to result in a Loss of Benefit penalty of 4 weeks
- Level 2 – For a first benefit fraud conviction the Loss of Benefit penalty duration will increase from 4 to 13 weeks
- Level 3 – Where there are two offences, within a set time period, with the latter resulting in a conviction the Loss of Benefit penalty will be for a period of 26 weeks
- Level 4 – A 3 year Loss of Benefit penalty will be introduced where there are three offences within a set time period the latter resulting in a conviction
- Level 5 – An immediate 3 year Loss of Benefit for serious organised and identity fraud cases