Fraud by landlord?

kunekune

Since you mention me by name ...

I agree that there is something stinky here, and on my reading of it, it could well be criminal. Whether the CPS would bother, especially because of the difficulty of predicting how a jury will interpret dishonesty and because it is very new legislation, is another matter. THey are notoriously over-cautious. From your perspective, the question is whether you want to take any action based on rumour. If you do, you will need to take legal advice - if only to make sure you don't get landed with libel accusations - and make sure the person you speak to knows all about the 2006 Act and is confident in dealing with new law (it isn't in all the textbooks yet, I won't tell you about my most-embarrassing-ever teaching moment on that front, but you might guess what could happen to a new arrival in the country). Closer to home, my advice (as a teacher rather than as a solicitor, mind) would just be that you don't want to do anything like this. It might not be criminal but it quite possibly is.

Bungarm2001

Well, for my part, I am ALWAYS going to read a thread that has the words 'landlord' and 'fraud' in the header.

It would be nice if you didn't have a slight dig at people who are just trying to clear things up for you and don't neccessarily seem to be on your wavelength.

real1314

A lot of people in this thread seem to think that if a fraud has occurred, the LL is the one that's gonna be up in court.
These people are wrong (imho).

The person responsible for the HB claim is the tenant. The LL has no liability at all to disclose any change of circumstances to the HB people as they are not the recipient of the HB.
The LL is the recipient of the rent from the tenant.

Any claim that the LL is liable because the tenant uses the HB to pay the rent, must therefore lead to a claim that a fraudulent claim for other benefits make Tesco liable if that money is spent there.

I'm not convinced that there is no problem, however it depends on how the mechanics of LHA work in respect of the £15 weekly excess allowance. Is this allowance calculated against the LHA figure used in place of allowed rent or at the end of the calculation when the amount of HB is paid out?

The fact still remains that the change in the rent accepted by the LL is down to the tenant to report, not the LL and as such any fraud would be the tenants.

Other points: It's not that it "could" be criminal, it would be, but it would be the HB fraud dept that would deal with it, not the CPS, usung social security laws. I also don't think that the LL has committed a "dishonest act" - they've simply re-negotiated, they have no duty to disclose this to anyone. The Tenant however has failed to disclose a relevant change of circumstances.

Bungarm - what if the LHA is £115 a week, and the LL offers the property at £100, and the HB claim is awarded at £115 with the tenant keeping their allowed £15 extra. But then the tenants asks for a discount of £10 a week and the LL agrees? Is anyone committing fraud, and if so, who?

SouthCoast

.........................................

I did state at the beginning that I DON'T know how LHA is calculated

How are the monthly rates decided?
The rates are set each month for different sized properties by The Rent Service which is an Executive Agency of the Department for Work and Pensions (DWP) and is independant from the council.
The rate you are entitled to will be based on the number of people that live with you and their ages.
Local Housing Allowance is not based on the property in which you live. It is based on:

• Who lives with you
• What area the property is in
• Your household income
• Your savings and investments

Local Housing Allowance rates are displayed at the Council’s office at:

• Civic Centre, Maltravers Road, Littlehampton BN17 5LF
• Bognor Regis Town Hall, Clarence Road, Bognor Regis PO21 1LD

You can also view Local Housing Allowance rates on this website.

Bungarm2001

"Bungarm - what if the LHA is £115 a week, and the LL offers the property at £100, and the HB claim is awarded at £115 with the tenant keeping their allowed £15 extra. But then the tenants asks for a discount of £10 a week and the LL agrees? Is anyone committing fraud, and if so, who?"

Well, in my opinion, the above scenario would be highly unlikely to happen, but I do see what you're getting at.

As HB is means tested, the tenant has to provide a current signed rental agreement to claim the LHA, so this would prove whatever rent the LL is asking for.

IF the LL agreed to a reduction in rent after the AST was signed, and in my opinion this would have to be a bluddy BIG IF, then on the face of it, it would look like the tenant was trying something fraudulent when in fact, the way things stand at the moment, he wouldn't be. Nor would the LL.

Supposing the tenant did manage to negotiate a rent reduction mid-tenancy agreement, (need a flying pig smilie here) and he had previously been granted £90 LHA and his rent was £70, and was therefore getting the maximum capped rate of £85; A few weeks later, when he negotiates the rent reduction of £10, he would be able to keep that as well as the original £15.

The reason why this can legally happen is because a rent increase or decrease is not seen as a 'relevant change' in circumstances that would cause an alteration of the amount of LHA payable to the tenant within a year of the start of his claim.

Once an LHA rate has been determined it will continue to apply until the next anniversary date, i.e. one year after the LHA was first awarded (I think..or it could be on the anniversary of the first payment...) Either way, it could be quite a few months until the next annual rent review where the tenant would obviously be obliged to disclose the exact rent payable or be subject to penalties. He would legally be putting £25 into his pocket

I'm not sure if a tenant is obliged to declare this kind of income..they might be if IS or other benefits are involved, but I know nowt about them. (All that concerns me is doing a good job as a LL.)

The ONLY way I could ever see a LL agreeing to a tenant negotiating a rent reduction mid-contract and after an LHA claim went through is if his property was in such a state no-one wanted it and this was the last resort, or there was a dire shortage of tenants in the area looking to rent. Even then, this would not be fraud.

SquatNow

HB was open to this sort of abuse... LL raising ent and HB paying it. LHA is a fixed amount so LL cannot abuse this.

Only situation where it could occur is where LL is well under market rent.

If LL demands more than market rent, tennant can leave.

Think the OP is describing a situation where tennant is in a far grander property than htey need... their money, their choice.

kunekune

As I said, I was looking at it in terms of general criminal law - I'm no expert in housing law per se. There will be strict liability offences that can be prosecuted by the HB fraud unit, but since the OP asked about "fraud", I looked at it from the perspective of the Fraud Act 2006. Now that, I am fairly familiar with, though it's difficult to predict how it will be interpreted until there is some case-law. There are times when there are good reasons to prosecute for the most serious offence possible, rather than the easily established strict liability offences such as failure to provide accurate information. Here, with a new regime in place, there could be a policy decision to whack this kind of practice on the head fast and with maximum publicity. So far as my assumption about the LL's liability, that was because the LL aided and abetted (or even procured) the T's fraud, knowing the essential details, and therefore is liable as an accessory.

mel19632

Thank you Bungarm - it does appear to that the LL is not committing fraud from your post (phew!).

I get the impression that the LL thinks they are getting one up on the LHA department, but per SouthCoast post, they aren't!

clutton_2

squat now says ""HB was open to this sort of abuse... LL raising ent and HB paying it. LHA is a fixed amount so LL cannot abuse this.""

another load of tosh

HB was not open to this abuse in the way you describe - HB rent payments were set by the RENT OFFICE - who still set LHA levels - and that is what the tenant/landlord received.

If the LL put the rent up - the tenant had to pay a top up. HB was ONLY increased in line with inflation each year.

Bungarm2001

Agree with Clutton...I have a tenant in receipt of HB and it wouldn't matter how high we put the rent up, the HB would remain the same. I don't know where you get your info from SN, but it's utter rubbish.