Overpayment of housing benefit

steve811

My mother who is in her late 70's lives in a small 1 bedroom flat which is owned by a local housing association. When my father was alive they received benefits as he was suffering from vascular dementia and she was his carer. When he died 3 years ago she was the beneficiary of his insurance policies which he always intended should go to me and my sister. When the money was paid out (just over £8000) we both asked my mother to hold the money, as we did not desperately need the money and she could get a better rate of interest. She also had some death benefits from his occupational pensions giving her a savings account which was just over £16000. Just before this money was paid out she made a fresh declaration to request a re-evaluation of housing benefit and council tax reduction, based on her income and finances at the time. She was awarded full housing benefit and full reduction in council tax.


In August she requested a move to a housing association sheltered property, and was asked to fill in a means form. Following that her benefits were stopped and she was asked why she had so much money in savings. She attended a short meeting with a council employee (they administer the benefits) and was accused of "fraud, money laundering and dishonesty" which almost drove her to despair. She was accused of having "four or five bank accounts" (not true) and was asked to provide bank statements for every account going back 3 years. After a lot of hassle with the bank we eventually got these and despite my advice she gave everything to the council.


She has now received a letter from the council which claims she owes just over £14000 in overpayments, and that if she wants to re-apply for benefits she must in future notify them of any large withdrawal from any of the accounts and the reasons! There is no explanation of how the amount has been calculated and no explanation of how they have arrived at this figure.


I have already made a formal complaint about the bullying and arrogant employee who accused her of having four or five bank accounts and of money laundering ( his exact words) and fraud.


The question is how do we go about challenging this, we agree she may owe something from when she went above the £10000 limit, but in our eyes the £8000 in the account was not hers and should not be taken into the calculations. Can anyone advise?

[Deleted User]

If it was sitting in her bank for so long it's hers so far as benefits are concerned. There's nothing to challenge she was overpaid and committed fraud by failing to declare it. Just be glad they're not prosecuting her.

nannytone_2

if it was in her bank account and she had access to it, then it is hers!

you say your father wanted you to have it.
was this specified in his will?
if not, ALL his assets would pass directly to your mother as his spouse.

when did your father die?
why did your mother make a new (single) claim for housing benefit and not inform them when she received the money? ( she signed the benefit form which states she has to inform them of any changes in her circumstances)

marliepanda

It doesn't matter whose money it was in your eyes. 85 matters whose money it was legally.

If the beneficiary of the policy was your mother, it's hers. If your dad intends it to go to you, that should have been part of the policy.

Nothing you can do about it. She hasn't been bullied. She's been accused of benefit fraud, which she has committed, whether she meant to or not.

Bogalot

When the money was paid out (just over £8000) we both asked my mother to hold the money, as we did not desperately need the money and she could get a better rate of interest.

This does contradict previous posts, regarding your own debt management and those of your "friend" with similar issues to yourself.

If your mother is going to use the above in some attempt to suggest that the money is not hers, be aware that authorised compliance officers can look at your own finances, and if they contradict your claims, your mother will end up in even more trouble. The chances of them prosecuting a person of her age are low, but if you combine the amount with wilful lies then it becomes a distinct possibility.

Your mother is entitled to a breakdown of how the overpayment is calculated. I would advise that she requests this and then uses said funds to pay it off.

steve811

Bogalot wrote: »

This does contradict previous posts, regarding your own debt management and those of your "friend" with similar issues to yourself.

If your mother is going to use the above in some attempt to suggest that the money is not hers, be aware that authorised compliance officers can look at your own finances, and if they contradict your claims, your mother will end up in even more trouble. The chances of them prosecuting a person of her age are low, but if you combine the amount with wilful lies then it becomes a distinct possibility.

Your mother is entitled to a breakdown of how the overpayment is calculated. I would advise that she requests this and then uses said funds to pay it off.

First all of all thank you for your compassion and understanding! My finances are a mess but we live within our means and at the time I knew if I had that £4000 it would go on things we did not need. On the other hand I had children who will want to go to university in the next couple of years and mum was holding that for me so we did not use it. Any compliance officer is welcome to look at my finances and try and find any extra money we have, I certainly cant! To those of you who say she has committed fraud, bear this in mind. When she applied for benefits after my fathers death in 2013 she was helped by Age Concern and their people, who were fully aware what insurances were coming and being paid out. Their attitude was that we did not have to declare it as it was not hers. We are talking about a 77 year old widow of a man who worked all his life and religiously all his and her bills, not a scrounging low life who deliberately cons the system.

Caz3121

steve811 wrote: »

she was the beneficiary of his insurance policies which he always intended should go to me and my sister.

your father should have changed the beneficiary for the policies then. As your mother was the beneficiary the money is hers and would be included in calculations of savings and affecting eligibility to means tested benefits.

PasturesNew

Unfortunately, what people want isn't "the law". Unless your dad left a will leaving that money to you, then the money was your mum's.

Even if she'd given it away to you at the time, it being hers it'd still count as what they call "deprivation of assets".

Fraud can be committed knowingly, or unknowingly - unknowingly by not reading the "rules" of receiving benefits, or not understanding the way things work.

So, the bottom line is: as she had that money (that was legally hers) at her disposal, and as she signed some forms at some point (benefits forms) saying she'd told them everything she had, then if she had more money than she said that'd be called "fraud".

You need to get beyond the word "fraud" to understand what has happened and why. See it only as a common word to name what's occurred. Not as an accusation. Do not fear the word, understand it's just a word to explain what's gone on ....

"Our money, dad wanted us to have it" - sorry to say, but this is only true/valid if it's written in a proper will. My dad would have wanted me to have his house money - unfortunately it had to be spent on mum's care home. That's how things work.

The money, legally, "was hers". Not yours.

I'm sorry for your loss and for the upset the system is now causing you, but you need to take a deep breath and understand the wording the system uses, what the system means and why things haven't gone right for your mum .... in order that you can get your head around this to take her forward.

xylophone

If the money was not expressly left to you (or in trust for you), or anybody else, then the proceeds of the policies belonged to your mother - it makes no difference if she had an informal agreement with your father that the money would go to his children.


If your father's will expressly left the proceeds to you and your sibling/or the policies were written in trust in your favour, then the money was indeed yours.

However, you say that you requested your mother to hold on to the money.

Now, if your mother was holding this money as your nominee or in bare trust for you, ( and there should have been formal written evidence of this) then the capital was yours, the interest was yours and should have been declared as yours for tax purposes.

The above does not appear to have happened - the situation could be construed as your having made a loan to your mother, in which case the capital was hers for the time that she had it and any income arising on it.


There appears to be no documentation, the money was in your mother's personal accounts or account and therefore benefits would be assessed according to her means and savings.

Your mother is fully entitled to an accurate statement showing how the overpayment was calculated - she will then need to come to an arrangement to repay?

Mersey_2

Yes, that's the crucial part.


If there's a Will - ie written by your late father - stating that his estate should be split as he told you verbally, this will help as evidence.


Other than a complaint re how the member of staff spoke to your mother and requesting how they calculated the £14k figure, I fear there's little you can do.

Alice_Holt

The answer to your question is that you can't challenge it.

An overpayment can only be successfully challenged if it resulted from official error. This is not a case of official error.

The overpayment arose because your mother failed to tell her housing benefit department about changes in her circumstances that affected her claim. As such, she was in receipt of a means tested benefit she was not entitled to receive.

Your suggestion to your mother not to supply information about her circumstances - "despite my advice she gave everything to the council"; would have considerably worsened the situation for her. I also very much doubt that the "formal complaint about the bullying and arrogant employee" you have made will have helped your mother.

She has the money to repay the benefits she received to which she was not entitled. The sooner she does this, and the less fuss you make about it the better for your mother.