Working while claiming the dole is by far the most common welfare fraud

Last Wednesday morning, civil servant Phillip Cox, accompanied by officers from the Garda National Immigration Bureau, swooped unannounced on a small recycling plant near Dundalk.

Of the 17 employees working in the plant, five were on the dole – including three who tried to make a break for it but were caught. Gardaí detained another two who had no work permits or documentation.

For Cox – the Department of Social Welfare's North East regional director – it was just another morning raid in the department's systematic efforts to combat social-welfare fraud, predicted to cost the taxpayer close to €500m by the end of the year.

The schemes used by the fraudsters are many and various. In his fight against fraud, Cox has dealt with individuals signing on while in prison, forged passports presented as proof of identity by criminal gangs, 'welfare tourists' who claim benefits on both sides of the border, false Irish addresses being given to comply with the two-year habitual residence condition and people who return to their native country but 'forget' to tell Social Welfare, which continues to pay child benefit.

Working and claiming is by far the most common fraud, whereby individuals work 'off the books' and claim jobseekers' benefit worth over €200 a week.

PPS numbers are systematically checked against Revenue files to see if that person is working. But it is harder to detect if the person is working off the books.

Raids based on 'local intelligence' such as that in Dundalk last week are the most effective way to combat the cheats. They also send a clear message to others who may be, or are contemplating, defrauding social welfare.

"There has been a seven-fold increase this year in the number of people phoning in with details of welfare cheats," said Cox.

"Ten or 20 years ago Irish people were vaguely tolerant of cheats, believing there was no harm in taking 'a few bob' from the system. That attitude has completely changed."

As well as receiving tips from the public, the department also works closely with the gardaí and the Department of Justice, particularly when fraud is entwined with criminal activity.

"We have had cases where people signing on turn out to be serving a prison sentence," said Cox. "What happens here is the individual gives his dole card to another while he is serving his sentence. Known criminals also use social welfare to legitimise their criminal activity. We now automatically cross-check claims with Justice and the prison service."

Passports are the most frequently forged documents presented as proof of identity and again this usually indicates orchestrated fraud by criminal gangs. "We immediately inform the gardaí when we come across a forged passport," said Cox.

However, he dismissed the story relayed in the Senate last month that a foreign-national couple had attempted to have their child baptised twice in different parishes in order to secure extra child-benefit payments.

"We do not accept baptismal certificates as proof of identity, only birth certificates, so that would not have worked," he said, although he admitted he had seen a few cases of forged birth certificates. "Proof of identity is critical as it is the gateway to so many benefits and we have to be very vigilant."

The standard bluff dole card carries just name and address but no photograph or any other form of identification. This makes impersonation easy and facilitates the sale of dole cards.

The introduction of state identity cards with biometric data is currently under some heated debate within government. While Cox acknowledged the implications for a citizen's civil liberties, he added that such as system would cut out a lot of fraud.

Up until last year, unemployment benefits were paid directly into a person's bank account and the individual only had to 'sign on' every four weeks.

To combat the increasing level of fraud, claimants now have to present themselves every week at their local post office, said Cox.

'Welfare tourism', whereby social-welfare recipients from Northern Ireland cross the border to sign on in the South and avail of the superior benefits, is a major cause of concern in Cox's area in the northeast.

"Along with gardaí and customs officers, we have set up 17 border checkpoints since April. It has been very successful and we noticed a sharp drop in the number of people signing on in border towns."

Increased immigration has led to increased opportunities to defraud the system. Last year, for example, a Nigerian man officially living here, whose wife was claiming for herself and their children, was actually found to be running a successful legal practice back in Nigeria which he admitted was bringing in $8,000 a month.

Cox and his officers also regularly 'cold call' and mail shot addresses given as proof of residence in the country. If there is no response in a week, the benefit is stopped.

Under the controversial habitual residence condition introduced in 2004, a person must show they have lived in the country for two years before they can receive benefits.

This was introduced primarily in response to the perceived threat of welfare tourism from the thousands of eastern Europeans who poured into the country following their countries' accession to the EU in the same year.

Two years ago, gardaí investigated two Romanians who allegedly were charging their fellow countrymen €400 each to arrange a valid address so they could secure a PPS number. The department no longer accepts a letter from a hostel as proof of permanent residence.

"We regularly check addresses and usually find 10% to 15% are bogus. In most cases, the individual simply disappears," said Cox.

Bogus child-benefit claims accounted for over €38m of fraud savings in the first six months of the year, according to the department.

All EU citizens are entitled to child benefit even if their children are living in their home country.

The most common fraud here is that people return home but omit to inform social welfare, which continues to make the payment, which should be paid by the individual's own country, said Cox.

Cox was quick to debunk the myth that foreign-nationals were primarily responsible for social-welfare fraud.

"It's not true. They are involved of course, but Irish nationals are just as adept at fraud," he said.