‘Rife’ furlough fraud being revealed by whistleblowers

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Whistleblowers are unveiling fraud committed by UK employers that have used the furlough scheme to make large sums of money by falsely claiming employees are on furlough.

Charity Protect has revealed that about a third (36%) of its Covid-19-associated calls involved furlough fraud. The number, it said, has risen each week. It is thought that this trend may be connected with the HMRC’s decision to close its hotline after moving staff to work from home during the pandemic.

Campaign group WhistleblowersUK described fraud as rife. It said it had received calls from employees who claimed they had been threatened that they’d be sacked if they did not continue working after being furloughed.

HMRC said it had received 795 written or online complaints about furlough fraud up until 14 May, despite the closure of the hotline.

Baroness Kramer, co-chair of the all-party parliamentary group for whistleblowing, told the Telegraph: “At a time like this when we as taxpayers are stepping forward to give people a lifeline, this abuse seems even more outrageous than it might under normal circumstances. Taxpayers are feeling the pain.”

Three main types of fraud have been identified:

  • A company furloughs staff but asks them to continue to work or volunteer unpaid.
  • Companies furlough staff without telling them. The workers only find out when they are paid.
  • A company claims furlough money for a “ghost” employee who may be someone they dismissed or “recruited” so they could claim the money.

The Telegraph cites the case of a software developer for a medium-sized business, who revealed to the newspaper he was summoned by his bosses and told he would be furloughed, but that he should continue to work from home. If he refused, they told him he would be fired.

He decided to call their bluff, saying he would not participate in a fraud and would take them to an employment tribunal if they fired him. He recorded all his conversations including one in which they named other employees who were party to the scam.

The company appeared to back down and he continues to work but still believes he may have to make good his tribunal threat.

Liz Gardiner, chief executive of Protect, urged HMRC to restore its hotline because of the risks of missing scams without it and then to investigate: “Our experience is that this is a new emerging problem that needs to be tackled.”

Georgina Halford-Hall, chief executive of WhistleblowersUK, said it was forcing law-abiding people to break the law or face the sack: “You can see the absolute terror that good people are experiencing.”

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2 Responses to ‘Rife’ furlough fraud being revealed by whistleblowers

  1. Avatar
    Fulano de Tal 20 Jun 2020 at 10:26 am #

    I am in this dilemma and feel that my employment position is compromised. I was placed on the furlough scheme despite the fact that my type of job requires a certain degree of tasks to keep an important aspect of the company up and running. The type of role I do ‘can clearly be carried out working from home’, hence my employers had no valid reason to select me as a candidate for the furlough scheme.

    Several colleauges have also been furloughed and are making revenue for the company but they are happy and comfortable with it. I contacted ACAS for advice regarding my concerns over the predicament I find myself in but they were just as flummoxed as me on what I can do about it!

    I hope the HMRC investigate the companies that have signed up for the scheme as it seems too much like easy free money to me.

  2. Avatar
    Lisa 25 Jan 2021 at 6:18 pm #

    I was furloughed, but also illegally working for my employer.

    On June 4th 2020, my employer called me to inform me that he would remove about 70% of my annual leave to be paid out during furlough because it was cheaper. I said that I didn’t think it was fair considering I was working during furlough to help the company and I don’t think they should be removing most of my annual leave.

    I actually have an operation planned and wanted to keep the annual leave for then, as I have a large tumour, which they knew about. My request to keep most of my annual leave was refused. I said they could take a third of my annual leave, as I had 7.4 days. I would like to keep 5 days for a post-surgery break. I have now had a tumour for over 12 months and it has caused pain as well as anxiety therefore I am disabled under the Equality Act.

    I found my employers quite dismissive of the fact that I had a tumour.

    A couple of weeks later, mid June 2020, whilst the company was shut for trading and everyone was on full furlough, I was informed my position was becoming redundant due to ‘poor sales’ although no sales were being made as it was shut, and consumer confidence was not the same. I’m the website and content manager for the company.

    In July 2020, the company had sent out a marketing email saying that they were very busy and all the courses (they provide sports classes for children) were booked up and they had to provide extra classes because of demand. Therefore I do not believe the reasons given for my redundancy, and my role was the only role considered for redundancy. I am also the person who usually sends out all of the emails.

    I lost my job, I believe because I objected to the removal of most of my annual leave whilst I was illegally working during furlough.

    Having a large tumour which can potentially turn cancerous and the surgery being delayed due to covid, as well as having lost my job, caused a lot of stress to me.

    It took me a long time to find another job, and it created further depression and anxiety.

    I have now filed a claim with an employment tribunal. They have engaged the services of their HR solicitor services to represent them. I am representing myself, so it is harder because I lack the legal background to deal with the case.

    I asked for my work emails which show I was working during furlough, under GDPR. A director responded that there is no personal data about me therefore they will not send the emails to me. Their HR solicitor services who I asked for the emails under GDPR – have also ignored me. The director stated that they have looked through my emails, in these emails I was given work to do such as crafting and sending out emails to staff and clients, and updating content on the website.

    I do have whatsapp screenshots of some work which I did for the company, however, which I will use as evidence.

    I also believe that I could have been a potential cost in terms of SSP as the director/owner of the company asked how long I would take off and I could not quantify the time. I have been a permanent employee for over 2 years and have never taken a sick day off or claimed SSP.

    If anyone could help, please let me know.

    Thank you.

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