The dangers of undisclosed savings for those claiming benefits

We all know that certain benefits are means tested, and are unavailable to those with savings or assets above a certain value. Yet every day, you hear stories of people being investigated and even taken to court over undisclosed savings.

It happens all the time, and everyone’s story is different. Only last week, this lady had her name dragged through the gutter press and was labelled a benefits cheat because she had money saved up in dedicated bank accounts for her disabled children.

Cynics might argue that when the savings amount to £40,000, this is something that she should have mentioned, but bear this in mind: In this case, we are talking about a single mother who has limited understanding of the UK benefits system and who grew up in a country where the disabled are at the very bottom of the social order.

Misunderstanding or wilful blindness? Either way, it would take a cold hearted judge not to have some sympathy for a woman with an otherwise unblemished record who was simply looking out for her children. Ultimately, the fact that she did not receive a custodial sentence seems like the right decision.

How do they know?

If you have ever found yourself on the end of a DWP investigation, you might think they have supernatural powers. After all, they ostensibly rely on the information you supply, so how is it they are so often able to spot when you’ve failed to mention something – even a long-dormant account that you had forgotten all about?

The answer is, of course, nothing magical, and a powerful IT system lies at the heart of the DWP’s information gathering resources. Called “Connect”, it trawls data from a whole range of sources. Understandably, HMRC is a little shy about saying exactly where it gets its information, but it almost certainly includes banks, credit cards, the Land Registry and so on.

One thing that is certain is that the information streams are growing. It can now obtain data from online companies such as AirBnb, eBay and PayPal.

Checking the accounts

The point that claimants need to understand is that the DWP has computer software that searches on names and finds accounts registered to claimants. If these accounts have not been declared, it triggers an automatic investigation and the claimant is sent a letter advising them that they will be invited for an interview.

At Hylton Potts, we have seen numerous instances of this, and the frustrating thing is that it is typically the elderly and vulnerable that seem to be targeted. Often, the accounts in question have lain dormant for years and are either empty or contain trifling amounts.

Here is another example – let’s call the lady Lindsay. She had received such a letter and was understandably confused and worried. It turned out that the DWP had found out about an ISA that Lindsay’s bank had persuaded her to open to try to save up a little money. Ultimately, the business of feeding herself and staying warm meant she had been unable to put more than a few pounds in it, and she had completely forgotten it even existed. Lindsay was asked to provide statements going back to 2013, to show there had not been thousands of pounds passing through the account.

Got a letter? Get help

We have helped numerous people that have been faced with DWP investigations. While everyone’s story is different, there is one common factor, which is that nobody simply sets out to defraud the benefits system as a fun way to make some money. Some are driven by desperation, some have made genuine mistakes and others are victims of errors on the part of the DWP. Ultimately, the investigative process is the same, and whatever your own personal story, it can be a harrowing experience.

That is why we strongly urge anyone under investigation by the DWP to get help. At Hylton-Potts, we deal with the DWP on your behalf so that you don’t have to attend interviews yourself. The sooner we can look into your circumstances, the faster we can help you resolve the situation and put it behind you, so give us a call us on 020 7381 8111, or email us at

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