Fraud team unearthed suspected �40m scam

IPSWICH benefit fraud investigators unearthed the suspected mortgage fraud which has led to an investigation into an alleged �40million buy-to-let swindle, it has emerged.

IPSWICH benefit fraud investigators unearthed the suspected mortgage fraud which has led to an investigation into an alleged �40million buy-to-let swindle, it has emerged.

Nine people, eight men and a woman aged between 29 and 73, are now on bail after being quizzed by police following raids on their homes in Sussex and London.

The current investigation involves an alleged scam worth at least �6m by people who are said to have taken out inflated mortgages on properties at the Persimmon Homes' Orwell Quay development at Ipswich waterfront, before pocketing the difference.

The suspected fraud uncovered by the Ipswich Borough Council investigators led to the discovery of similar alleged swindles around the country in Manchester, Nottingham, Stoke, Leeds and Thamesmead near Dartford.

A series of inquiries headed up by City of London police are now under way. They are said to involve 10,000 victims with potential losses running into hundreds of millions of pounds.

The Ipswich benefit fraud officer, who discovered the apparent fraud at Orwell Quay- which involves around 70 flats, said: “In early 2007, our benefits section received some claims for housing benefit which they asked us to check out as there seemed to be a discrepancy with the National Insurance number on one of them.

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“I looked at all the claims and, it's funny but I had a sort of sixth sense that something was wrong. I checked further and believed it was part of a bigger scam. I had to sift through six claims in total and found there were links between them.

“I spent months on this investigation and I also alerted colleagues at several other councils.”

John Carnall, deputy leader of Ipswich Borough Council, said: “I am very proud that our benefits section identified what they thought was a fraud.

“It was then followed up by our fraud unit and after months of perseverance and doggedness they identified six tenants who were falsely trying to claim council tax benefits.

“The benefit fraud officer was suspicious there was more in this than benefit fraud and he alerted police."

Mr Carnall added that had the benefit fraud not been spotted just over �50,000 would have been paid out by the council.

This week's arrests centre around Eastbourne Financial Services Limited (EFS), a mortgage brokers based in East Sussex, which is currently in liquidation. The investigation involves mortgages taken out with Bradford and Bingley.

More than fifty officers from the City's Economic Crime Department, assisted by officers from Sussex Police, took part in the pre-planned operation. Arrests were made at six residential addresses in Sussex and North London and searches also took place at three business premises.

The operational activity is part of an ongoing investigation into a mortgage fraud affecting mortgages taken out on more than 500 properties in the South of England between 2005-2007.

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