DWP bank account check warning for group of people likely to be worst-hit

Legal experts are concerned new powers from the DWP to "request bank statements" will negatively impact claimants across the country.
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A fresh warning has been issued over Department for Work and Pensions ( DWP ) bank account checks. Legal experts are concerned new powers from the DWP to "request bank statements" will negatively impact claimants across the country.

Law firm Clyde & Co 's Damian Rourke, a partner in the fraud risk practice, said: "This could spark concerns around privacy for many. Allowing government bodies such access to personal financial information could leave people feeling exposed and contribute to an erosion of public trust."

He also warned older, disabled and at-risk claimants are most likely to be harmed, saying: "Certain groups in receipt of higher benefits payments, such as the elderly, disabled or other at-risk populations, could also be disproportionately affected by these measures, increasing the likelihood of errors and unjust outcomes."

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The group said: "Mistakes could leave individuals struggling to meet basic needs, such as paying bills or buying food, causing unnecessary distress. Misidentifying accounts or failing to account for a claimant’s circumstances could lead to wrongful deductions, sparking legal battles and emotional upheaval."

Clyde & Co cautioned: "Cash payments create a shadow economy, undercutting businesses operating within the system. Informal cash payments often come without legal protections, leaving workers exposed to exploitation, unsafe conditions, and wage disputes."

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The group stated: "These collaborative efforts could paint a more accurate picture of claimants’ financial situations, reducing fraud risks and minimising errors." The new Public Authorities (Fraud, Error & Recovery) Bill was introduced in Parliament this week and forms part of wider plans to save the Government a total of £8.6billion over five years. The DWP estimates that benefit fraudsters cheated the taxpayer out of £7billion last year.

As well as plans to recover money directly from bank accounts, the DWP could also get benefit cheats banned from driving if they repeatedly fail to pay back what they owe. The DWP will have the power to recover money directly from bank accounts of benefit fraudsters who are no longer on benefits, or in PAYE employment.

The benefits department will target people who have the means to pay, but have refused to do so. The DWP will be able to request bank statements but will not have direct access to bank accounts.