Care home fraud soaring as families attempt to hide assets from HMRC

The Audit Commission has claimed that fraud in the care system has almost doubled in a year as middle-class families attempt to hide their assets from HMRC. The watchdog recorded an 82 per cent rise in the amount lost to councils last year as families avoided nursing home fees or failed to report the death of a loved one in order to keep receiving payments of up to £60,000 a year. The Audit Commission said that the ageing population and government policies were responsible for the sharp increase.

At present, anyone with savings over £23,000 has to pay for residential care, which can cost £200,000 a year, until their assets fall below that threshold. However, the commission believes that some families are trying to hide their savings by transferring money out of their accounts, while others are falling foul of obscure rules when the transfers are legitimate.

Alan Bryce, the Audit Commission’s head of counter-fraud, revealed that the 82 per cent rise in losses meant that £4m had been defrauded from the care system in 2012–13. He also said there had been a 64 per cent rise in the number of cases of fraud detected over the same period. However, Bryce added that the figures were a ‘drop in the ocean compared with the scale of fraud and few cases were pursued’…

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