Coronavirus - first furlough fraud arrests are made

According to Personnel Today, the West Midlands Police have arrested a man suspected of defrauding the furlough scheme of around £495,000. They've removed his computers and other documents as part of its investigation into suspected furlough fraud, money laundering and other tax fraud. 

HMRC have repeatedly warned businesses that it will pursue those who deliberately defraud it. This public arrest demonstrates its intent.

Those that make genuine mistakes have less to fear - but they will still have to repay HMRC. If you suspect you've got your sums wrong (the calculations aren't for the faint hearted) it's sensible to have another look at them and take steps to correct errors. HMRC are expected to offer a 30 day 'amnesty' soon to allow businesses who have made genuine mistakes, or have incorrectly claimed to 'confess' and repay money to it without incurring penalties. 

You can also also now use the online service to delete a claim within 72 hours of submitting it - which will be useful if you make an error when claiming. Or, if you miss that deadline and are still receiving furlough grants, you can correct the over payment in your next claim. Further information about how to repay HMRC can be found in  government guidance. 

Earlier this week, Lily Pidge from our Regulatory & Criminal Investigations Group provided some useful tips to make sure that businesses stay the right side of the law and the steps to take if they make mistakes. Her helpful blog can be found here.

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Richard Las, acting director, Fraud Investigation Service, HMRC, said: “The Coronavirus Job Retention Scheme is part of the collective national effort to protect jobs. The vast majority of employers will have used the CJRS responsibly, but we will not hesitate to act on reports of abuse of the scheme.

“This is taxpayer’s money and any claim that proves to be fraudulent limits our ability to support people and deprives public services of essential funding.

“As usual, we have built steps in to prevent mistakes and fraud happening in the first place, but anyone who is concerned that their employer might be abusing the scheme should report it to HMRC online.””