HOUSEHOLDS are being warned over a Universal Credit scam that could leave them out of pocket.
The Sun first warned in November 2018 that a loophole allowed fraudsters to claim cash by making fake advance payments.
The scam sees fraudsters take out a so-called Universal Credit budgeting loan in someone else’s name.
These budgeting loans have to be repaid, but the scammers typically disappear with the cash leaving you with debt to repay.
In 2019, one mum lost her £780 a month benefits after a fake loan firm signed her up for Universal Credit and stole her cash.
Meanwhile, another woman was recently chased by debt collectors for a £1,480 Universal Credit claim she hadn’t made.
Crooks had simply applied for the benefit, requested a Universal Credit advance payment and then never paid it back.
The advance payments are emergency loans to help you get through the five-week wait for your first Universal Credit payment.
The DWP has now issued a new warning as scammers make the most of the cost of living crisis to exploit the social security system.
A spokesperson told BirminghamLive: “The vast majority of claims to Universal Credit are legitimate and fraud and error in the benefits system remains very low, with 96.5 per cent of benefits paid correctly.
“We continue to monitor and investigate emerging fraud threats and pursue those seeking to rip off the taxpayer using the full range…
