Thousands face incorrect benefit cuts from automated fraud detector

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Thousands of people could soon be receiving letters threatening to cut off vital housing benefits as they face being incorrectly targeted by a new automated fraud detector.

The government-backed London Counter Fraud Hub, developed by BAE, has been hailed a success after being trialled in four boroughs – Camden, Ealing, Croydon and Islington.

Using vast quantities of data from millions of households, it is designed to target potential fraud cases involving the single person council tax discount, subletting in local authority housing and business rate relief and rating.

Ealing, the lead council for the project, found the automated elements of the system targeting single person discount fraud was 80% effective – which is seen as an acceptable benchmark.

With just over one million claimants of council tax single person discount in London, the London Counter Fraud Hub estimates it will detect around 40,000 fraudulent cases in the first year.

Critics say the 20% error rate is unacceptable as around 8,000 people will receive letters wrongly accusing them of fraud.

Joanna Redden, co-director of Cardiff University’s Data Justice Lab said: “When automating a system like this, when you know some people are going to be wrongly identified as committing fraud, and that many will have few means or resources there are serious concerns that need to be addressed.

“I would urge the councils who are considering automating this process not to do so, particularly given what we know about how this kind of system can go wrong.”

Asked if this error rate was acceptable, Ian O’Donnell, former Executive Director of Corporate Resources for Ealing Council, who co-ordinated the pilot, said it was possible to appeal single person discount notices within a year of their issuance.

“We’re very conscious of fact that we don’t want a computer-based big brother type operation where people get unreasonable judgements made on them without any human intervention in the process.”

A spokesperson for Ealing Council told Sky News that the council was not accusing anyone of fraud, and was only seeking to verify its information.

“We will not cancel anyone’s council tax discount without giving them a fair say, which is why we are writing to them first. The council has experience of dealing with vulnerable people and others who need help communicating and will ensure we use the best channels of communication and provide support where necessary, as we do already,” the spokesperson said.

It is estimated the system could save London’s 33 local authorities around £15m every year.

(c) Sky News 2019: Thousands face incorrect benefit cuts from automated fraud detector

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