Firms warned of fraud over government’s jobs furlough scheme

An employment lawyer is urging businesses to ensure they are not breaking the rules of the Coronavirus Job Retention Scheme.

Businesses are urged to ensure they are not breaking the rules of the Coronavirus Job Retention Scheme when accessing government support as cases of fraud spike.

Over the last few weeks reports of fraudulent use of the Coronavirus Job Retention Scheme have increased, with companies now more at risk of inspections from HMRC than ever before.

Tina Chander, Head of Employment law at law firm Wright Hassall, is calling on companies to ensure they have not knowingly or accidentally broken the rules.

She said: “Companies must ensure that they are applying the rules correctly and are not making any errors when claiming the sums back from HMRC for the furlough scheme.

“Businesses need to be careful when they are submitting these claims and should ensure that the information they are providing is accurate to avoid any accidental scenarios of fraud, which is something that we have seen more of recently.

“Until July 1 2020 employees designated as furloughed workers are not permitted to carry out any work on behalf of their employer. If an employee has undertaken work whilst furloughed, and the company has claimed their salary from HMRC under the Job Retention Scheme, the company will be at risk of fraud.

“Companies can now repay any over-claimed money through the HMRC portal, but with the cases of fraud increasing dramatically in recent weeks, more companies should prepare to have their claims inspected.

“If an HMRC investigation takes place finds that the company has claimed money fraudulently, they could find themselves being required to repay any monies they have received and may also face further sanctions from HMRC.

“The Government has not yet indicated the sanctions that may be imposed, but these have previously included “naming and shaming” the companies, requesting repayment of monies and issuing additional penalties. The Government may also consider criminal investigation and prosecution.

“This is not something that should be taken lightly and, with HMRC’s spotlight focused on potential fraud, companies need to act quickly to ensure they have claimed the right amount.”

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