Episode 17 Saints and Scroungers

One of the things that makes this country great

is that whenever we find someone in genuine need, we help them out.

It's a much-needed hand up when times are tough.

It's a terrible experience.

It's like hitting a brick wall.

But then, whenever there's cash on offer,

you'll always find someone who wants to steal it.

He withdrew it all in cash.

Allegedly, it was for the purpose of repaying loan sharks in part.

But those who cheat the system will usually get what's coming to them.

He did plead guilty to all charges.

This is the world of Saints And Scroungers.

Saints And Scroungers highlights the worthy and corrupt people

that are taking money out of our welfare state system.

On one hand, there are legitimate claimants.

On the other, you have cheats

who are bent on ripping off the taxpayer.

It's a war that's fought every day across the UK.

Fraud investigators battling to bring the cheats to justice,

and saints fighting to make sure people in true need

get what they deserve.

Coming up on today's show...

a fraudster bent on ripping off the taxpayer,

despite being minted...

He had deposited into his bank account about £327,000.

..and we meet a family that found help,

after their situation seemed hopeless.

The doctors gave up on him,

and then you get a tiny charity that wants to help,

and it's like a miracle.

Fraud investigators not only detect fraud,

they also work hard to regain the money that's been lost.

And to do this, they often have to work with other agencies

and government departments.

This is a story about how someone

who thought they could get away with playing the system

came up against more than they bargained for.

Meet 60-year-old Martin Wright,

who worked as a part-time cleaner

and needed help with benefits because of his low income.

I've come to the Insolvency Service

to meet with Liz Thomas, who was the official receiver

responsible for looking into his case,

along with investigators from other organisations.

Let's talk about Martin Wright.

When did he first flick up on your radar?

15th March, 2010,

when the Colchester County Court made a bankruptcy order against him.

He owed money to Tendring District Council,

and they asked the court to make him bankrupt,

to try and force him to pay.

So once somebody's been made bankrupt,

what does that mean for them in the immediate future?

Well, it means that any assets that they have

at the date of the bankruptcy order belong to the bankruptcy estate.

But it does mean that your assets, they're not yours any more?

They're taken and they can be realised, as you say,

-liquidated, turned into money, to pay off your creditors.

-Yes.

And Martin Wright's creditors, Tendring District Council,

were not just seeking to get money back that he owed to them.

This was money that had been stolen from the taxpayer.

Nicola Russell was the fraud investigator in charge of the case.

Mr Wright was working as a cleaner for a cleaning company.

He advised that he was working around 16 hours a week.

He had stopped claiming benefit for a short while,

a couple of years, and then re-applied,

because he had bought a property in Frinton-on-Sea.

In total, over a seven-year period,

Martin Wright claimed £17,864

in housing and council tax benefit,

which he was entitled to, given his low earnings.

However, his claim came under the spotlight

when fraud investigators became suspicious about his true income.

Mr Wright's claim came to my attention due to the benefits team.

They'd asked Mr Wright for some wage slips

for his new company that he worked for.

These wage slips were in the same format

as a previous company he worked for,

therefore, they were suspicious that something was wrong.

Wright was claiming that he now worked

for a company called Help At Hand,

and investigators decided to check out this employer.

There's no details anywhere that I could say

that there was a company that existed.

Maybe Wright had made a mistake,

or maybe he just made up his employer,

but why would anyone do that?

Nicola didn't waste any time in going to find out.

As I couldn't find any information on Mr Wright or the company,

I decided I would make a visit to the property where he lived.

When I arrived at the property in Frinton-on-Sea,

it was a large, detached property.

To me, it didn't look like

a property that someone was claiming benefit from.

It definitely doesn't sound like a place

that a cleaner on a very low wage would be living in.

Nicola couldn't interview Wright

properly there and then,

but when she did eventually get to put specific questions to him,

he told her that the information they had for him was correct,

except for one important detail.

I then took a statement

from Mr Wright. Mr Wright confirmed that

they had one Barclays account,

and that they were on a low income,

and he was earning approximately £80 a week.

Mr Wright said he worked for a company called Clean 205.

Hold on, Clean 205?

I thought he worked for a cleaning company called Help At Hand!

While companies

of similar names might exist

and, of course, people do change the company they work for,

this new information raised more questions for the investigators.

The fact the wage slips provided looked similar

prompted suspicion that Wright didn't actually

work for either of these companies

and had falsified the pay documents.

Nicola decided to go and have

another chat with Wright,

to get to the bottom of his employment situation.

I knocked on the door

and it took some time for Mr Wright to come round from the back.

When I questioned Mr Wright if that was his name,

he said, "No, it's not me."

Mr Wright denied that he was himself.

I did ask to speak to Mrs Wright,

and she eventually did come to the door.

I was only able to speak to Mrs Wright,

as Martin Wright refused to be interviewed by me.

So Martin Wright had been giving false information to the claims team

and had clearly been trying to avoid the investigators

when they came round to question him.

There was something wrong with Mr Wright,

and the team needed to try a different tack

to get to the bottom of what was going on.

After the interview, I sent a letter

to Mr and Mrs Wright,

asking for bank statements and wage slips.

The new wage slips advised a different company

that Mr Wright worked for, Star Hygiene Ltd.

Hold on, now he was saying he worked for another company,

a different employer. The investigators had asked Wright

the same question three times and got three different answers.

Nicola's team focused on finding out

who was behind this latest cleaning company, Star Hygiene,

and also did a bit of digging to see if Wright had any other income.

As I was unhappy with the information

that Mr Wright had supplied to me,

I decided to run some checks through Companies House.

He had no current companies open at the time that I checked.

However, when checking his wife's name,

I could confirm that

she did have a current company that was not dissolved.

This company was called Star Hygiene Ltd,

which was the company that was on Mr Wright's wage slips.

Wright had been working for his own wife's company.

Didn't mention that on his claim form!

Investigators suspected that Wright must have been getting

more than what he'd stated his weekly wages were,

especially when they found out just how successful the company was.

Additionally, I checked Land Registry

and found that they had an undeclared property

that was registered under the company name.

The Land Registry check showed that Mrs Wright owned the property

and that they'd bought it just after

the housing benefit claim had finished,

but they didn't advise it

when they re-applied for council tax benefit.

They had two houses.

Seems like Mr Wright had not been particularly honest

while making his benefit claims,

and while there was no suggestion

Mrs Wright had been involved in any wrongdoing,

further digging revealed some more interesting information.

Mr Wright wasn't just a cleaner at his wife's firm.

He was in charge.

So, Martin Wright wasn't just a low-paid employee,

he was, in fact, the boss of a very successful company.

And they were about to find evidence to show just how successful it was.

I found out Mr Wright had a hidden business,

therefore, I knew he must need a bank account to put the money in.

Therefore, I did a credit check on him.

Through the credit check, I found an undeclared bank account.

Getting the statements from this bank account,

I found that he had £98,000

going through this account

over two years.

£98,000 - that's serious cash.

With the evidence stacking up against Wright,

the fraud investigators decided to bring him in

for an official interview under caution.

When he was questioned about the money in his accounts,

he said this wasn't his money.

Mr Wright was asked about

the undeclared property

and he would not admit it until he was shown the Land Registry.

I asked him if he still owned the property, and he said it was sold.

Wright seemed to have an explanation for everything.

But eventually, he did admit that he'd fraudulently claimed

over £17,000 in benefits from the council.

Mr Wright was charged with five offences -

for failing to declare a bank account,

failing to declare that his wife had a directorship,

and failing to declare a property.

He did plead guilty to all charges.

The fraud team had their man.

But would they get the council's money back?

Mr Wright refused to pay any of his overpayments.

Therefore, we decided to go through the insolvency services

for bankruptcy action to be taken.

For now, though, it's farewell to the fakers and fiddlers

and hello to the people we call our saints.

Those in society that help others in real need,

but who are too proud,

or often don't know how to claim what they're entitled to.

Taking the decision to start a family is a big plunge,

and it can put stresses and strains on a relationship,

even when things go smoothly.

But when things turn out in a way you hadn't expected,

well, that's when our welfare system and support groups are invaluable

in helping people to find a different kind of family life.

Carol Terrell was happily married, had a good job,

and was hoping to develop her career

after she returned from maternity leave.

There were complications during the birth of her first baby,

Charles, but when he did eventually arrive, she was overjoyed.

His jet black hair and his blue eyes,

and...oh, he was beautiful.

I just loved him from the day I saw him.

Just an amazing feeling,

to have this special child in your hand.

Staff at the hospital told Carol that Charles was fine,

but she did notice a few things about him

that didn't seem quite right.

He had a very strange cry.

It wasn't a normal baby cry.

His eyes just stared at you. There was no emotion in his face.

He didn't hold anything, but we thought that was normal.

We weren't sure.

Something was wrong.

Carol took Charles to a private doctor to get a second opinion,

and they discovered that he had problems with his digestive system

which would need an operation.

They also identified the first signs of some kind of brain disorder.

It was a very difficult Christmas,

knowing that you were having to face an operation

in the New Year for him,

and not knowing whether this was going to work.

And even if it did work,

how do you face life with a child that's got brain damage?

How are we going to cope with this?

What is his future?

Charles underwent a successful operation

to correct the digestive problems,

but doctors said there was nothing medically they could do

to help him with the many other problems

that were preventing his development.

The prognosis was that there was no reason why

he wouldn't have a normal lifespan,

but that possibly,

he could lie on the floor for the rest of his life.

When doctors said there was nothing more

they could do for Charles medically, well,

that's when Carol thought she had nowhere left to turn.

Then a friend told her about BIBIC,

a charity that offers practical advice and support

for parents that have children with developmental problems,

Jeanette Saunders is a senior developmental therapist

in the organisation.

Charles first came to BIBIC when he was 11 months old.

He could only roll just a little bit

and his head control was quite poor for an 11 month old.

The staff at the charity conducted a two-day assessment

with Charles to work out a programme for Carol to carry out.

We discovered that Charles was hyperextending,

which means he was throwing himself backwards and tensing his muscles.

His hands were fisted, so he wasn't opening them

and exploring as he should be, or holding objects.

He had very little balance,

he wasn't sitting, and his head control was very poor.

So we devised a programme to address all of those issues.

'This was actually giving me a routine,'

with smells, with tastes, with exercise.

Five, four, three, two, one.

Finish. Good eating.

It all seemed to be going well,

but when cracks appeared in Carol's relationship with her husband

and he decided to leave the family home,

Carol's world fell apart and she struggled to cope with everything.

I was in a lot of debt.

I couldn't work, I was totally reliant on benefits.

Having to get the children to school...

Eventually, my dad stepped in and he took the children to school for me

and I collected them, so it just gave me a break.

'He doesn't always go through the night, so you're tired,

'so you need to somehow find some time during the day to sleep.'

It was very, very difficult.

Looking after a child with the sort of difficulties

that Charles has would be hard for any parent,

but doing it alone and with no income took its toll.

The charity helped Carol navigate the complex benefit system

and she received housing benefit, income support,

Disability Living Allowance and Carer's Allowance, which helped

a little, but it was still a tough time for the family.

It really did affect Mum.

She kind of... She wasn't herself.

I guess she was depressed.

The day my husband left...

BIBIC have been amazing.

They gave me a bursary to continue the programme,

and never have not seen him. They've never rejected him.

They've always been there.

With Charles's future with the charity secure,

Carol could concentrate on delivering his programme,

and everybody in the family

would have an important contribution to make.

From experience, it is important to involve the whole family.

Siblings can feel left out, or not involved.

With BIBIC's help, we got Charles to walk,

and it's such a transformation to see this boy who...

at...I think it was three years old was still lying on beanbags,

who still couldn't get up. We then saw this transformation,

and we saw him walk, and we're developing his speech right now.

The programme, that included exercises

to develop Charles physically and mentally,

was providing astonishing results when he started school.

Charles progressed in a way that we never expected him to,

and it was enhanced by the BIBIC programme.

When I knew what they were doing at school,

BIBIC showed me how to do those things,

and we enhanced his programme at home.

But when it came for Charles to move on to secondary school,

it wasn't going to be a straightforward transition.

We had a problem with the school saying,

"No, we don't want to take him," having said that they would.

Charles had been out of school for two years,

but with the help of the team at the charity,

Carol succeeded in getting him a place back in full-time education.

And during this time,

the team also provided some advice for Carol

that proved crucial in Charles's next stage of development.

BIBIC then recommended me, while he was out of school,

to join Scouts, so as to give him something to do.

So we started Scouts in 2008,

and that was the best thing we've ever done.

It was giving him people to mix with, and the leaders were amazing.

David Ward was one of the Scouts

that Charles became friends with after he joined.

Everyone kind of interacts with him. He responds well to them.

And no-one kind of thinks,

"Just cos he's slightly disabled, we're not going to include him."

In all the teamwork and stuff, in all the games,

he's always been put straight in a team.

Everyone kind of accepts him,

and they've taken quite a liking to him.

Push the mouse... You can do it.

David and Charles hit it off so well

that Carol decided to make David an offer he couldn't refuse.

The charity had helped the family access direct payments -

these are a government benefit which enables people with disabilities

to have the freedom to choose and pay for their own care

and services to suit their own needs, and Carol knew

the best way to spend Charles's money was by employing David.

Carol happened to mention that

they'd got the extra time given to them for a carer,

so I took on that role,

and I've been doing it for about a year now.

And since then, we've got him up climbing walls,

we've got him bouldering, which is low-level climbing,

we've got him jumping in rivers, canoeing, kayaking.

It's just great seeing him achieve all the stuff he does.

It's a weight off my shoulder, because this means

he is now being treated like a normal teenager,

without Mum being around,

and he's got a nice young lad that's happy to deal with his needs,

but also treats him normally, which Charles prefers.

And he hasn't stopped there.

Charles's journey continued last year, when he carried

the Paralympic torch with other members of his Scout troop.

Charles just loved it, absolutely loved it.

And he enjoyed all the people shouting at him

from the balconies, and we were running alongside him.

It was so nice to see BIBIC's work.

He carried it for all the people that supported us,

from the church, from BIBIC,

all the Scout people who have been there for him

and have supported him,

and I felt that day he carried it,

it was like landing on the moon and...thank you.

No doubt Charles will have other challenges in his life

as he moves on, but with the help of the charity

and the support of his family,

he is now well equipped to deal with whatever life has to throw at him.

Now, though, it's time to return to our self-serving scroungers.

The Fraud Investigation team at Tendring District Council

have successfully prosecuted Martin Wright for illegally claiming

over £17,000 in housing and council tax benefit.

After securing a conviction for the benefit fraud,

Tendring District Council

referred the case to the Insolvency Service

after Wright refused to pay back the money

he'd stolen from the taxpayer.

OK, so this is fairly straightforward, then.

He's defrauded the council from benefits,

he has to pay those back, he can't do it,

therefore, the council is asking the court

to make him bankrupt, insolvent.

I think in this case, it's a case of he wouldn't pay the money back,

not necessarily that he couldn't.

We had already spoken to Tendring Council, who had indicated to us

that Mr Wright had had quite a considerable amount of money,

so we had a look in his bank accounts,

and looked at the period prior to the bankruptcy order,

and we found that in August 2009,

he had deposited into his bank account

about £327,000.

So, where did that money come from?

The money came from the sale of a property,

and it was the net proceeds after payment of the mortgage.

So he sold a house, and the difference between

-the mortgage and the amount he sold the house for is that 320,000?

-Yeah.

Wright had been sentenced to nine months' imprisonment

for the benefit fraud, but if he thought that

when he got out, that would be the end of the matter,

well, he didn't quite appreciate how investigating authorities

work together to protect taxpayers' money.

It was now Liz's responsibility

to try and see how Wright could repay Tendring District Council

the £17,864 that he owed to the taxpayer.

So you go to him as he is released from jail, or some days afterwards,

and what do you say, exactly?

Well, we go through a questionnaire of questions

which look at establishing what assets he might have,

and also establishing what other creditors he might have.

-OK, so what did he have?

-Nothing.

-Nothing at all?

-No.

-That's what he told you?

-That's what he had.

-He had nothing?

-No.

-So, you looked in his bank accounts?

-Yes.

-Nothing?

Not at the date of the bankruptcy order, no.

You checked... Where did he live at that point? Was he homeless?

-He was in rented accommodation.

-So, nothing there, no asset.

-No.

What?! He sold his property

and withdrew the proceeds from his account

at exactly the same time that he owed Tendring District Council

the 17 grand he'd ripped off from the taxpayer.

So what's your next move, then?

What can you do at this point as a sanction?

Well, I have quite wide-ranging powers as an Official Receiver,

and one of those powers allows me to look at individuals' conduct

before they were made bankrupt, and to make an assessment of

whether I think that that conduct is reasonable.

And in this case, I assessed that it wasn't reasonable,

and in those circumstances, I can make application for

a Bankruptcy Restrictions Order. Because Mr Wright

signed a Bankruptcy Restrictions Undertaking,

which is a legal document whereby he agrees to abide by the restrictions.

OK, so he's a bankrupt for longer,

but it's still not really

A) getting your money back for Tendring Council,

and it's not really...doesn't really feel like a punishment,

cos he's playing fast and loose with bankruptcy anyway.

But in this case, we also submitted a report to

the Department For Business, Innovation & Skills' legal team,

because we felt that there was criminal actions, as well.

The Department For Business, Innovation & Skills

has a special investigation section, which was created to make sure

insolvency and bankruptcy aren't abused.

Ian West was the Investigations Officer in the department

that was given Martin Wright's case to consider.

The suggestion of criminality was the fact that he had a property

which nobody knew about

until the Official Receiver made their enquiries,

which was worth some £500,000.

The equity in the property was some £327,000.

And when he sold that property, he withdrew the proceeds,

contrary to the bankruptcy order.

He withdrew it all in cash and, allegedly,

it was for the purpose of repaying loan sharks in part,

and I think he might well have said that

-he gambled other parts of it away.

-Ian and his team

had to work closely with Liz at the Insolvency Service

to establish the case against Wright.

We had all the documentary evidence provided to us.

So then what we have to do is reduce it to evidential form

by taking witness statements.

A key aspect of the case for investigators

at the Department of Business, Innovation & Skills

was the timing of the sale of Wright's property.

But before they could tackle that, they had to establish the facts.

The Land Registry records all sales and purchases of property,

so by going to Land Registry, you can get the details of

who sold and who bought the property,

and the amount that it was bought for.

So that actually proves the fact that he had ownership of it,

what money he got from it, where that money went.

And when it did go to court, Wright was found guilty again -

this time, for bankruptcy offences.

Martin Wright received an immediate custodial sentence of six months.

Another good conviction for the team.

And all of the authorities

involved in this case plan to keep pursuing Wright,

to get back that £17,864

that he still owes to taxpayers.

If any assets can be found that he has,

then they will be taken possession of by the trustee in bankruptcy,

who is the Official Receiver.

So there's a warning, then.

You may think you've hidden the money well,

but the authorities won't rest until they've reclaimed every penny.