When SHAC attempted to gather evidence for our report on extortionate charges for services, or charges for ‘phantom’ services never delivered, it became clear that there was a strong possibility of fraud in some of the cases that were sent to us (alongside incompetence and mismanagement).
Errors are easily made, but if an error is brought to the landlord’s attention and they refuse to address it, the question arises as to whether there has been deliberate and fraudulent activity.
So what to do if you suspect fraud? You can report the suspected fraud to the housing association board who should take it seriously and investigate it. However, tenants and residents often feel too vulnerable to report suspected fraud to an organisation which has the power to victimise them in their own homes.
Approaching the Authorities
It is possible to report fraud to the authorities without revealing your identity. The authorities investigate cases where they feel there is sufficient cause.
Tenants and residents do not need to prove service charges are fraudulent, they just need reasonable grounds to suspect it. However, you should save anything that might be useful evidence, such as hard copies of the bills and invoices.
The report should be made to Action Fraud, the “national reporting centre for fraud and cybercrime in England, Wales and Northern Ireland.” (See Reporting a Suspected Fraud below for details).
SHAC is also able to support tenants and residents with these matters. You can contact us at email@example.com.
Examples of Possible Fraud
Examples of possibly fraudulent charges submitted during our research included a case at Southern Housing Group. A a resident told the landlord that a contractor had billed them for replacing items that did not actually appear to have been replaced. The resident explained that
Those items were either a) replaced, in which case there should be a charge, or b) not replaced in which case there shouldn’t be a charge. There is no grey area. It is very easy to check if something has been replaced”.Southern Housing Group Resident
Initially the landlord claimed that the items had actually been replaced, but eventually acknowledged the lie and withdrew the charge.
In another case, Clarion Housing Group charged £3,200 for communal electricity in a block of just nine flats. Clarion failed to supply any bills to support this cost. The tenant has asked for up-to-date metre reading, but only ever received estimated costs. The metre had only been read once in five years.
Yet even more extreme was Hyde Housing, where residents of a nine-apartment block received a communal electricity bill for nearly £7k. The previous bill had been just £37.84. The resident said:
“We are a very small block of just nine flats so are shocked at the high charges. We only have a small number of lights in the hallway, an intercom system and a very small electric heater in the foyer which isn’t on very often.”Hyde Tenant
This is not just an issue in large housing associations. After a long and arduous battle, a Housing for Women (HfW) tenant was informed that the landlord would refund charges for the cleaning service due to having no cleaning. The refund was never paid to the tenants.
In fact, there were a shocking number of incidents reported at HfW. Over an eight-year period, those who wanted to park had to purchase and pay for parking permits. However, many residents did not have cars, and therefore questioned the car parking service charge. First they were told that the charge was for maintenance of the grounds, then the charge suddenly disappeared from their bills.
Tenants also informed HfW that the CCTV was not working, nonetheless, the landlord continued charging for it. They were also charged for refuse collection even though their rubbish was actually carried away by the local council.
None of these cases prove fraudulent activity but are sufficient to raise questions. The suspicion grows stronger when the landlord refuses to address the issue on being alerted to it.
To Report a Suspected Fraud
Action Fraud offers a 24-hour online reporting service. As well as enabling victims to report a fraud, it signposts to other sources of help and support – see here.
There is telephone advice line which will put you through to the Action Fraud contact centre. You can talk to specialists about suspected fraud and cybercrime by calling 0300 123 2040.
Using Action Fraud could lead to an issue being investigated by the police. The authorities have the powers and technology investigate properly, and uncover any wrongdoing.
Many tenants and residents have begun withholding payment of rents or service charges after being unable to get satisfactory evidence that the charge is legitimate.
For more details of this strategy, please see the SHAC Rent and Service Charge Strike Group page.
9 June 2021