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<p>HMRC’s estimate for the amount lost to fraud and error in the schemes during 2020-
21 is 8.7 per cent in Coronavirus Job Retention Scheme (CJRS), 2.5 per cent in Self-Employment
Income Support Scheme phases 1-3, and 8.5 per cent in the Eat Out to Help Out (EOHO)
scheme. This equates to £5.8 billion, against a spend of £81.2 billion.</p><p> </p><p>HMRC
prioritised getting money to those who needed it with the schemes designed to minimise
fraud while not unnecessarily delaying payments. The schemes were designed to prevent
fraud, both in the eligibility criteria and the claim process itself. However, they
could still be attractive to fraudsters.</p><p> </p><p>To ensure quick payment, HMRC
undertook pre-payment risk assessments of 22 million claims (£93 billion) within 72
hours of receipt, blocking those indicating criminal activity.</p><p> </p><p>HMRC
have taken a supportive and reasonable approach where mistakes have been made, giving
customers the opportunity to correct them without fear of sanctions. By law, claimants
can notify and amend incorrect claims within 90 days without penalty. An online system
to help people correct mistakes was set up and all claims are risk assessed and considered
for post payment checks. HMRC look at a variety of factors, including comparing the
claims to historic data (e.g. pre-pandemic payroll data), third party information,
and other intelligence, like Fraud Hotline calls. HMRC have also compared claims made
to different support schemes to identify where they might want to ask more questions,
such as in the case of a restaurant who had furloughed all their staff under CJRS
but were also claiming under the EOHO scheme.</p><p> </p><p>Claims HMRC think are
higher risk, or appear more complex, are selected for “One-to-One” intervention (OTO).
Lower or less complex risk claims are considered for “One-to-Many” (OTM) Campaigns.</p><p>
</p><p>OTM are written campaigns to address simpler risks. The same communication
is sent to up to tens of thousands of customers. HMRC are clear with what they are
asking, where to get support, and how to put it right. They also ensure there is follow
up if customers do not respond to the OTM approach.</p><p> </p><p>OTO interventions
are direct enquiries by experienced compliance officers for more complex risks.</p><p>
</p><p>HMRC are taking tough action to tackle fraudulent behaviour. Anyone who keeps
money despite knowing they were not entitled to it, faces repaying up to double the
amount, plus interest and potentially criminal prosecution in serious cases.</p><p>
</p><p>HMRC established the Taxpayer Protection Taskforce, which is estimated to recover
approximately £800 million to £1 billion in the two years to 2022-23, on top of around
£500 million which was recovered in 2020-21. HMRC will continue to address fraud and
error in the schemes beyond the duration of the taskforce.</p><p> </p><p>For COVID-19
schemes, compliance checks are carried out when HMRC suspects there has been an overpayment
of the claim, which may be due to either error or fraud. This work is still ongoing
and therefore HMRC cannot say what proportion of any amount that is fraudulently claimed
will be from businesses based in Plymouth, Devon, and Cornwall.</p>
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