Scams.&.Scandals.S2024E04.Britains.Biggest.Benefit.Scam
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00:00Police officers!
00:03An extraordinary scam that cost the British taxpayer millions.
00:08We've dealt with what we thought were bag of rods before until we came upon this one.
00:13For nearly five years, an organised crime gang in London cheated the benefit system.
00:19It's not just a few friends doing a few claims.
00:23It's, to this day, even them figures still unnerve me.
00:27To steal over 50 million pounds.
00:30This is shocking. The figure is huge.
00:33Flying over thousands of people from Bulgaria to make false claims.
00:38It was benefit fraud, quite clearly, on an industrial scale.
00:42And spending the money on a luxury lifestyle.
00:46Bersace, Alexander McQueen.
00:48But how did they manage to cheat the system and commit Britain's biggest benefit scam?
00:57Benefit fraud has soared in recent years.
01:04At the Department of Work and Pensions, a highly specialised team were trying to catch those responsible.
01:10But the scale of one scam in particular caught everyone by surprise.
01:15My own gut reaction was, there is something wrong.
01:19But I couldn't say at that point, was the scale, but that was why I contacted CPS.
01:24There is something going on here.
01:26We need to escalate that a little bit further.
01:29It was in 2019 when fraud investigator Carol Ann Mungan from the Department for Work and Pensions
01:34started seeing patterns from a number of referrals coming in from Jobcentre staff and elsewhere.
01:42Benefit applications with some similarities were being made.
01:46And when the coronavirus pandemic hit, those claims rocketed.
01:49We were obviously working during the pandemic and we had other jobs that we had to do urgently to help people.
01:56But the referrals were still coming in at a rapid rate.
02:00Carol Ann and her team were having to deal with that and start to build the case up.
02:06I don't think any of us realised just how big it was.
02:09We could see it had the makings of it, but it was a case that was an organised crime gang
02:16because of the amount of claims, but nowhere near the size.
02:21The claims were all for the main benefit, Universal Credit.
02:25It's there to help support people on either low incomes or people who are currently out of work.
02:30Anyone can apply and the amount that you receive depends on a number of different factors.
02:36That includes whether you're in work, how much income you receive if you are in work,
02:41but also things like any health conditions that you may have,
02:45any other benefits you might be claiming, but also whether or not you have any dependents.
02:52They were tracked back to a variety of businesses in North London.
02:56It was clear the team was dealing with highly organised benefit factories.
03:01It's usually a place where you have multiple claims being applied for from that location,
03:08but without the appearance of it is it's a legitimate business,
03:13but its underlying factor is to commit the fraud.
03:16There were benefit factories set up across North London.
03:19From the outside, they appeared to be legitimate businesses,
03:22but inside they were forging documents making false benefit claims,
03:27stealing millions of pounds.
03:29The key factor was the repeating patterns.
03:33So you'd have multiple claims going through one address,
03:38which is just not logical for a benefit claim.
03:41You'd have multiple claims all using one mobile phone number for communications,
03:47inherently suspicious.
03:50Painstaking analysis of each claim started to reveal common details,
03:54linking the claims, perhaps through the font or wording of a letter,
03:59got them a step closer.
04:01Investigators realised the first fraudulent claim occurred in 2016.
04:06Sometimes you had the same address,
04:08but you might have a different style of tenancy agreement
04:10in a different landlord,
04:12but you wouldn't know until you'd seen them all.
04:14But then sometimes there'd be different addresses,
04:16so that's where it'd become quite hard as an investigator.
04:22The gang used a variety of forged documents,
04:25including fictitious tenancy agreements,
04:27counterfeit payslips,
04:29and forged letters from landlords, employers and GPs
04:33to bolster their fraudulent claims.
04:35And it worked.
04:37The cash came flooding in,
04:39as video was found on one of their phones.
04:43Money stolen from the taxpayer
04:45and meant for those most in need,
04:48thrown into the air as confetti for fraudsters.
04:52Little did they know, however,
04:54the authorities were closing in.
04:56In May 2021,
04:58the team got permission to raid several properties.
05:01When did it dawn on you
05:03that this was off the scale?
05:07I think it was confirmed on arrest day.
05:11You know, the culmination and preparing the file
05:14and the investigation and gathering the evidence,
05:17gathering the information.
05:18We knew it was big,
05:19but when, like, the organisation on the arrest day.
05:26The investigation team targeted these three locations,
05:29which were posing as legitimate businesses,
05:32accounting or translation services
05:34for Bulgarian nationals.
05:37This food shop, which is now closed down,
05:40may look unsuspecting,
05:41but just through the back,
05:43Britain's biggest benefit fraud was taking place.
05:46Police officers!
05:49Oops.
05:51This raid is the culmination of two years of work.
05:55Police officers!
05:56A short distance away,
06:03another business was also raided.
06:06We found computers open,
06:08actually on the Universal Credit application sites.
06:13We also found thousands of SIM cards,
06:17hundreds and hundreds of phones.
06:19Behind his desk,
06:21he had a big poster of the scar face,
06:25you know,
06:25the Al Pacino scar face,
06:27with Al Pacino in it,
06:29which I thought was kind of ironic.
06:31The fraudster's homes were also searched.
06:34Investigators couldn't have dreamed
06:35of what they were about to find.
06:37One of the investigators rang in.
06:39There was,
06:41well,
06:42we now know to be 750,000,
06:44but there was just massive quantities of money
06:47in various locations in the house.
06:49She just went,
06:50well, it's everywhere.
06:51It's in bags,
06:51it's under the bed,
06:52it's all over the place.
06:54There's some shoes.
06:55Designer gear.
06:56Yes.
06:56Expensive makeup.
06:57Expensive makeup, yeah.
06:59And that's an expensive hairdryer.
07:00Dyson hairdryer,
07:02I think they're around about £500 a pop.
07:05And then you've got watches.
07:06Yep.
07:07Versace,
07:08Alexander McQueen,
07:09another high brand,
07:10high value brand.
07:11Coco Chanel,
07:13Ugg boots,
07:14the Moncler jacket is the big one.
07:17How much is this one worth then?
07:19Between £12 and £1,500.
07:21Is it?
07:21I don't know where to get them, yeah.
07:23The fraudsters had been putting in
07:25false universal credit claims
07:27and spending the cash
07:29on their luxury lifestyle.
07:31Does it infuriate you?
07:32It does.
07:33It does.
07:34Especially when you think
07:35a big period of the offending
07:37was during the pandemic.
07:39You know,
07:39when people were losing jobs,
07:41people were going to food banks.
07:43The evidence was left spread about,
07:45as you can see from the photographs.
07:47They never expected a chap on the door
07:49and somebody come in
07:50and sees all that evidence.
07:52They thought,
07:54in my opinion again,
07:56that they were
07:56at no risk of being found out.
08:00So little wonder
08:02they were shocked
08:03when you walked through the door.
08:04Little wonder.
08:06Everything found during the search
08:08gave investigators an insight
08:10into how the multi-million pound fraud
08:13was committed.
08:13The evidence shows
08:16that they were bringing Bulgarians
08:18from Bulgaria to the UK
08:20for the purpose of putting through
08:23their benefit fraud factory.
08:25I think the favoured method
08:27of fraud here was
08:29we'll bring these people over,
08:32we'll charge them a fee
08:33for setting it over,
08:35and then when they've gone back,
08:37we'll take over the claim
08:39and then we'll have the payments
08:40for ourselves.
08:41Are we talking about
08:426,000 Bulgarians
08:44being shipped over here?
08:48Potentially.
08:49It was very sophisticated.
08:51They had false tenancy agreements,
08:54templates almost,
08:56so templates which would then
08:57be obviously changed slightly
08:59to go with different landlords
09:01and what have you.
09:02The massive phones
09:04were all linked
09:04to different claims.
09:06A lot of them will have
09:07names and reference numbers.
09:11On the back of the phone
09:12there was,
09:13this is the telephone number
09:14that's associated
09:15with this person's name.
09:16And if it was a dual SIM
09:17there would be two names.
09:18Right.
09:18And the claim number
09:20or whatever it was
09:20behind it as well, right?
09:21What's this then?
09:23That is a voice-changing microphone
09:26that you can change your voice to.
09:29Other sexes,
09:31e.g. a male speaking
09:32as a female
09:33and vice versa.
09:35And so that would be necessary
09:36because they'd get received
09:39phone calls
09:39and they'd have to answer them
09:41and answer the questions.
09:42They would have to answer
09:43the questions
09:44but obviously they don't want
09:45to alert the person
09:47at the benefit centre
09:48that they're not,
09:50you sound like a man.
09:53So they would definitely
09:54be changing it there
09:56to mask their true identity.
10:00Police officers!
10:01On the day
10:04there were a lot
10:04of very excited investigators
10:06having gone to the scene
10:08and found piles of mobile phones
10:11and piles of SIM cards
10:13mountains of claim packs
10:17but of course that creates
10:18huge practical problems.
10:21That is a lot of data
10:23to process and quantify
10:25and get ready for court.
10:30Proposed in 2010
10:31by the Coalition Government,
10:33Universal Credit
10:34was a replacement
10:35for six means-tested benefits.
10:38Its aim was to simplify the system,
10:40cut costs,
10:42encourage people into work
10:43and crucially,
10:45reduce fraud.
10:47It was rolled out gradually
10:49from 2013
10:50in different areas
10:51but far from smoothly.
10:54Weak management,
10:55ineffective control
10:56and poor governance.
10:57A highly critical report
10:59by the National Audit Office
11:00says the introduction
11:01of the government's
11:03flagship welfare policy,
11:04Universal Credit,
11:06has been plagued by problems.
11:08Admin issues meant
11:10payments were often delayed
11:11and many claimants
11:12ended up in debt.
11:14As I speak to you,
11:15how much money do you have?
11:17Nothing.
11:17A full pay.
11:18The government did make
11:20some changes
11:20which improved the system
11:22and started rolling it out
11:24to more and more people.
11:25Applying for Universal Credit
11:26is really simple.
11:27There are a few ways
11:28you can go about it.
11:29So you can apply online,
11:31there is a phone number
11:32you can ring
11:33but also you can apply
11:34in person at a job centre
11:36and then when applying
11:37you just need to give
11:38a few simple details
11:39so details like your name,
11:40your address
11:41and also your national
11:43insurance number as well.
11:44With the Covid pandemic
11:46came even more people
11:47claiming benefits,
11:48the number of claimants
11:49nearly doubled
11:50in the first three months.
11:52To cope with demand
11:53and the pandemic restrictions,
11:56the benefits rules
11:57were relaxed.
11:58Crucially,
11:59face-to-face checks
12:00largely disappeared
12:02and the fraudsters
12:03saw an opportunity
12:04to strike.
12:05It is obviously,
12:06the primary for the department
12:08is paying the people
12:09who need the benefit.
12:11They still ask for support
12:12and documentation to be sent
12:13so we're still receiving
12:14that information
12:15but obviously we didn't have
12:17the person sitting in front
12:18of the officers
12:19to go through
12:20that documentation.
12:23In the first two years
12:25of the pandemic,
12:26£10.2 billion
12:28was lost to fraud
12:30and universal credit.
12:35Following the raids,
12:36five people were arrested.
12:37all were Bulgarian nationals.
12:41Ganesh Ali,
12:42Galina Nikolova,
12:44Patrizia Paneva,
12:46Stoyan Stoyanov
12:47and Svetka Todorova.
12:50Ali was clearly
12:51a ringleader in the gang.
12:52The evolution of the gang
12:53begins with Ali.
12:56We could see that
12:57Ali essentially taught
12:59the gang how to operate.
13:02Combing through the evidence
13:03gave investigators an insight
13:05into the role played
13:06by each person.
13:08Ali posed as a legitimate businessman
13:10with flashy videos
13:12poster on his company's
13:14Facebook page.
13:19Our aims as a start
13:20are to reach a level
13:22where we have a branch
13:23in every big country in Europe
13:25and also in the big cities
13:27in England.
13:29Nikolova appeared
13:30to have been trained
13:31by Ali.
13:31She started in his business
13:33and then she moved
13:35into a business of her own.
13:37She took one of Ali's employees
13:39that was Paneva
13:40who migrated from
13:41Ali's business to hers
13:43and then Stoyanov
13:44also played a smaller role
13:46within the gang.
13:47So she took Ali's
13:49original ideas
13:50and she expanded upon them.
13:53Galina Nikolova
13:54had worked at Antonia Foods.
13:57People in the area
13:58remember Nikolova
13:59working behind the counter
14:01in the shop
14:01here on the high street
14:02but their main memory of it
14:04is of a woman
14:05with striking eyebrows
14:07that they were quite friendly with
14:08rather than one of Britain's
14:10biggest scammers.
14:15When she wasn't working
14:16Nikolova was enjoying
14:18a lavish lifestyle
14:19which she documented online.
14:22Ornate dresses
14:22and visits to a stately home
14:24featured on her social media pages.
14:27She even struck up
14:28a relationship
14:29with fellow fraudster
14:30Stoyan Stoyanov
14:31with the pair
14:32posing pictures of themselves
14:33on holiday in Istanbul.
14:35Our nature is
14:37civil servants
14:38you're protecting the public purse
14:40number one thing
14:41and you're seeing
14:42the extravagance
14:43looking into
14:45why were they posted
14:46what were they doing it for
14:48to encourage other people
14:50and that's when
14:52the alert starts
14:53it's a false
14:54lifestyle to have
14:55because it's maintained
14:57on fraudulent benefit claims.
14:59Todder Rover
15:00followed a similar pattern
15:01of fraud
15:02but she did it
15:03from her own home
15:04so she was not
15:05in Ali's business
15:07and she was not
15:07in Nikolova's business
15:08but the claims
15:09that she was working on
15:10were linked
15:11to the same claims
15:12that were running
15:12through their businesses
15:13and the way
15:14that she was approaching
15:15fraud
15:16was the same method
15:17of fraud.
15:19They made 6,000 claims
15:21for universal credit
15:22between October 2016
15:23and May 2021.
15:26Some in their own names
15:28the vast majority
15:29on behalf of fellow Bulgarians
15:31who were flown over
15:33with the sole purpose
15:34of committing fraud.
15:36They advertised
15:37their services online
15:38as post in Bulgarian
15:40claims they can help
15:41anyone with settled
15:42or pre-settled status
15:44in the UK
15:45with national insurance numbers
15:47tax and bank accounts.
15:49In reality
15:50they were selling
15:51their help
15:51to scam the DWP.
15:54It's not just
15:55a few friends
15:56doing a few claims
15:57it's to this day
15:59even those figures
16:00still unnerved me.
16:02The gang were passing
16:03claims between them
16:04they were reviewing claims
16:06and saying
16:06OK this one
16:07needs an employment contract
16:10it needs pay slips
16:11it needs a false tenancy
16:12in order to support it.
16:14You could see
16:15that what this gang
16:16was doing
16:17was they were trying
16:18to hit
16:18every possible pocket
16:20of money
16:20on each claim
16:21so that each
16:23false clay
16:23would be returning
16:24the maximum amount
16:25of money.
16:26It was benefit fraud
16:28quite clearly
16:29on an industrial scale.
16:30My opinion
16:31it started small
16:32and they just got greedy
16:34because they found
16:35it too easy.
16:38With their suspects
16:39in custody
16:39it was time
16:41to interview
16:41the fraudsters
16:42they had been chasing
16:43for years.
16:44Mr Ali
16:45Ms Mikulovas
16:48Mr Stoyanov
16:49if they were all
16:50just trying to cover
16:52themselves
16:52or going no comment.
16:54When Ali was interviewed
16:55one of the things
16:56that he did say
16:57in an interview
16:58was that was the reason
16:59for the break up
16:59of the business.
17:01They weren't honest people
17:02and that's referring to
17:03Galena and Patrizia Peniva
17:04and that had caused
17:06the fallout
17:06or that was the
17:07insinuation
17:08in his interview.
17:09So his argument
17:10would be that
17:11all the claims
17:11that you can link
17:12to me
17:12were genuine people
17:14using genuine documents
17:15and that the reason
17:16he split with them
17:17was because they
17:18started supplementing
17:19the crimes
17:19with fraudsters.
17:20Which was absolutely
17:21not the case
17:22obviously.
17:23I read the interview
17:25transcripts
17:26for the defendants
17:28and I compared them
17:29to the material
17:30in front of me
17:31and I found
17:32their explanations
17:34to be fanciful
17:35and fictions
17:36quite frankly
17:36they bore no resemblance
17:38to the materials
17:39actually in front of me
17:40which is quite strong.
17:42A common theme
17:42was they were running
17:44legitimate businesses
17:45they were simply
17:47helping needy people
17:48with their claims
17:50to benefit
17:51and if other people
17:54were committing fraud
17:55that was nothing
17:56to do with them.
17:57You go through
17:57all the evidence
17:58and you start
17:59all the analysing
18:00again
18:00and then you've also
18:02got time limits
18:02you've got to get
18:03everything to CPS
18:04because they're
18:05wanting to know
18:05it's fast paced
18:07it's very fast moving
18:08but you've got to be
18:10accurate at the same time.
18:12Whilst authorities
18:12were trawling
18:13through the mass
18:14of evidence
18:14found
18:15the gang members
18:16were released
18:17under investigation
18:18but three of them
18:19tried to flee the country.
18:21Nikolova tried to apply
18:22for a Bulgarian passport
18:24under false pretenses
18:25and Todorova
18:26was stopped
18:27at Stansted Airport.
18:29A number
18:29of the suspects
18:31then appeared
18:33at airports
18:35some of them
18:36with their family
18:37some of them
18:38with a large amount
18:39of luggage
18:39and we would rapidly
18:41present for the situation
18:43of what do you do?
18:45You can't let them
18:47flee the country.
18:48I was giving strong advice
18:49you have to apply
18:51for a remand
18:52into custody.
18:54These defendants
18:54are a flight risk
18:56if you let them fly
18:57we may never secure
18:59justice against them.
19:00So we have to take action
19:02and we have to do it now.
19:03The decision was made
19:05to charge Todorova
19:07and Nikolova.
19:09However,
19:09Ganesh Ali
19:10managed to flee
19:11to Plovdiv
19:12the second largest city
19:14in Bulgaria.
19:15Prosecutors
19:16were determined
19:17to bring him back.
19:18By that point
19:19I knew that Ali
19:20was a leading figure
19:21in the criminal gang.
19:23He was a person
19:24of particular interest.
19:26The information
19:27already suggested
19:28that to me.
19:29So when I learned
19:29that he had managed
19:30to flee to Bulgaria
19:31I was frustrated
19:32and exasperated.
19:35It was really challenging.
19:37The first level
19:38of court in Bulgaria
19:39really struggled
19:40with our application.
19:43They made several
19:44very detailed requests
19:46for further information
19:47all of which we responded to
19:49but it took time
19:50and took translation.
19:52And ultimately
19:53they declined
19:54our request.
19:55They refused to
19:56extradite a leave
19:58from Bulgaria
19:59back to the UK.
20:00So we then had to think
20:01about appeal procedures
20:03in a foreign country.
20:05The higher court
20:06in Bulgaria
20:07agreed and did
20:08extradite Ali
20:09back to the UK.
20:10He was a key player
20:11so it was only right
20:13that he was brought back
20:15and brought to justice.
20:18When he was finally
20:19extradited to the UK
20:20in 2023
20:21he made a desperate effort
20:24to look innocent.
20:24after initially denying
20:28the offences
20:29all five pled guilty
20:31to fraud
20:31in April 2024
20:33at Wood Green Crown Court.
20:35It was a sense of relief
20:37when the last one pleaded
20:39because initially
20:41it was going to be
20:41a very long trial
20:42which we were prepared for.
20:44and again
20:47I work for a department
20:48which is taxpayers' money
20:49so we've avoided
20:50the cost of a trial
20:51and the weight of evidence
20:53was obviously
20:54significant
20:55in those guilty pleas.
20:58With the five key players caught
21:00it's clear
21:01that they weren't
21:02the only ones
21:03who benefited.
21:04Many of the claims
21:05were made on behalf
21:06of other people.
21:08Are there more people
21:09linked to this gang
21:11that are being prosecuted
21:12beyond the five
21:13that we know about?
21:14I don't think
21:15I can answer that question
21:16at this time.
21:18I've worked on some big cases
21:19but nowhere near
21:22the scale of this
21:23the complexity of this
21:25and the amount of money
21:28and the amount of claims
21:29involved with it
21:30don't even compare.
21:32What we think
21:33is particularly cruel
21:34about this sort of crime
21:35is that of course
21:36this money
21:37has been taken away
21:38from those
21:38who need it most
21:39but also
21:40that has been
21:41taken from the taxpayer.
21:43It's still dumbfounded
21:44at the size of it
21:45to be honest
21:46the magnitude of it.
21:49I think we've
21:50learned a lot from it.
21:53I'm pretty confident
21:54it won't happen again.
21:56There have been lessons learned.
21:59Due to that
22:00there's been some changes
22:01to our system.
22:03Despite the lessons learned
22:04the question remains
22:05how did they manage
22:07to fraudulently claim
22:08almost £54 million
22:10over nearly five years?
22:13We put this
22:14to the DWP
22:15who told us
22:16that the complexity
22:17of the case
22:17the massive intelligence
22:19needed to be worked through
22:20and the need
22:21to secure police resources
22:23all meant
22:24that arrests
22:25weren't possible
22:25before May 2021.
22:27A month after
22:30pleading guilty
22:30they were back
22:31in court
22:32for sentencing.
22:34Five Bulgarian
22:35nationals
22:36have been sentenced
22:37to a total
22:37of 25 years
22:38in prison
22:39after being convicted
22:40of the biggest
22:41benefit fraud
22:42ever in Britain.
22:44Galina Nikolova
22:45was sent to prison
22:46for eight years.
22:48Ganesh Ali
22:49got seven years
22:50and three months.
22:52Stoyan Stoyanov
22:53four years.
22:55Patrizia Paneva
22:56got three years
22:57and two months.
22:59Svetska Todorova
23:00got three years.
23:03Judge David Arenberg
23:04said the gang
23:05stole eye-watering sums
23:07and that this
23:08had been fraud
23:08on an industrial level.
23:11Despite praising
23:11the DWP investigators
23:13he criticised
23:14the woefully inadequate
23:16and extremely lax
23:17checking system
23:18which failed to identify
23:20the same names
23:21addresses
23:22and telephone numbers
23:23that were being used.
23:25But what happened
23:26to all that money
23:27and will the taxpayer
23:28ever get anything back?
23:30We found assets
23:32in the name
23:32of our defendants
23:34and we freeze them
23:36and we prohibit them
23:37from transferring them
23:38or selling them
23:39and then confiscation
23:41and that's where
23:42this case is heading now.
23:44Post-sentence
23:45it will move
23:46to my colleagues
23:47in the Proceeds of Crime
23:48Division
23:48who are very good
23:49at what they do
23:50and they will
23:51systematically work
23:53what assets
23:53are attributed
23:54to this gang
23:55and they will not
23:56be looking just
23:56at the UK
23:57they'll be looking globally
23:58they'll be looking
23:59particularly at Bulgarian
24:01and based on what
24:02they find
24:03they'll be restraining
24:04and confiscating
24:06as much of that
24:07as they can possibly achieve
24:09so there's an expert team
24:11that will work on that.
24:12All these kind of things
24:13are put into a pot
24:14and get auctioned off
24:15and hopefully get some funds
24:17back into the public pot.
24:20And what will happen
24:21to the gang
24:22after the time in prison is up?
24:24I'm confident
24:25we'll oppose any deportation
24:27until confiscation
24:29has been satisfied
24:30because justice
24:32is not just about
24:33sending these people
24:34to prison
24:35it's also about
24:36getting the money back
24:37for a public purse.
24:39Britain's biggest benefit
24:41scam must end
24:41with this court
24:42imposing the longest
24:43ever prison sentences
24:45handed down
24:46for stealing
24:46from the welfare system.
24:48Their greed
24:49and arrogance
24:50became their undoing
24:51the theft of money
24:52intended to help
24:53the country's poorest
24:54was too simple.
24:56But the ease
24:57with which they were able
24:57to scam the system
24:58raises uncomfortable
25:00questions
25:00for the Department
25:01for Work and Pensions
25:02and for you and I
25:04the taxpayer
25:05whose money
25:06they ultimately stole.
25:11So you can see
25:15the crime
25:17that the government
25:18is going to be
25:20under your own
25:21education
25:21and the funding
25:22is going to be
25:22a legitimate
25:23and the security
25:23of the company
25:24opposed to the
25:25government
25:26of the government
25:27and the government
25:28for the government
25:28and the government
25:28is going to
25:29to be able
25:30to access the
25:32to their family
25:32and actually
25:32the второй
25:33government
25:33is going to
25:34water
25:35and the people
25:35that they
25:37are going to