'Mass‑scale fraud' feared in council lettings

A police investigation into housing fraud in Barking and Dagenham could reveal links to organised crime gangs, a councillor has said.

City of London Police said "hundreds" of Barking and Dagenham Council-owned homes could have been fraudulently allocated to people by "corrupt housing officers for personal gain".

Labour councillor Rocky Gill said the scope of the investigation could potentially reveal "mass-scale organised fraud – criminality at its highest end", such as by using properties for cannabis farms and other illicit purposes.

As part of its investigation, the force has so far arrested six people, two of them on 4 September, although no-one has been charged.

The Labour-run council says the investigation is solely linked to properties owned by B&D Reside, its wholly owned private housing company, rather than its own council stock.

The council set up B&D Reside in 2015 to let and sell affordable homes it built as part of its major regeneration projects.

According to the Local Democracy Reporting Service, the local authority has amassed £1bn in debt to pay for the regeneration, which it hopes to repay with income from rent and sales.

Council counter-fraud and risk manager Kevin Key said the case involved "multiple" housing blocks. He said fraudulently let homes had been used for "anything you can think of that is linked to housing, tenancy fraud".

Key told councillors at an audit and risk committee meeting this week that the council had recovered 12 fraudulently let B&D Reside homes since April.

Key added that some people had used false documents to apply for homes meant for people on low incomes.

He said others had used legitimate documents, but with "the sole intention of using that property for various things other than living there," including putting properties on the short-term lettings website Airbnb.

Gill added: "If they're being used for every possible criminal use, it suggests to me that we're heading down the route of organised crime here.

"You see it with private tenanted properties – some of them turn up, they're being used as cannabis farms. Some of them are being used for illicit uses as well – completely unethical and immoral uses."

Key said the council had worked with B&D Reside to put stronger measures in place to prevent fraudulent applications getting through and was working on recovering properties.

However, he said the police-led investigation meant having to check "hundreds of thousands" of documents for homes that had already been let.

Det Insp Adam Maskell from the City of London Police's Domestic Corruption Unit (DCU) said inquiries were ongoing and "focused on identifying the key players involved".

"Investigations into large-scale fraud are complex and can take time, particularly where there are many individuals and large volumes of material to examine," he said.

Maskell added that the force would "continue to work closely with partners in local government to progress the investigation".

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