DWP on your case for allegedly spending your money in order to carry on claiming Universal Credit or other benefits? Read on, to learn about some ways of defending your case.
Accused of spending your money in order to continue to claim Universal Credit or other means tested benefits? - Read this article to understand how you might be able to prove the DWP allegation is incorrect.
Over the last few weeks we have received a number of requests for support from people that are facing scrutiny from the DWP in relation to the fact that money they once had in the bank is no longer there.
The DWP are particularly interested to see if money has been "moved" to another place e.g. under the bed, has been spent on luxury items or given to friends and family, to name just a few of the things they are interested in.
Doing these types of things is known as "deprivation of capital".
Deprivation of capital is when you knowingly reduce or transfer elsewhere your savings or other capital to get, or increase your award of Universal Credit or other means tested benefits. This may be before making a claim or during an existing claim.
If your capital has reduced significantly you may be asked for evidence that you no longer have it. This may include:
The DWP will look at the evidence to decide if you have reduced your savings or other capital, by how much and why you did this. You will be treated as still having the capital if it is decided that you did this to get, or increase your award of Universal Credit. This is called notional capital.
Reliability of DWP/UC decision making in respect of deprivation of capital
The DWP are very prone to to making incorrect decisions in relation to whether somebody has deliberately got rid of savings or property and in this article we aim to provide you with some information and caselaw that could prove invaluable for anyone being accused of capital deprivation.
The only real test that the DWP should applying is whether the person deliberately deprived themselves in order to claim or increase benefit payment
We are currently working on cases where we have seen Decision Makers trying to disallow benefit and argue deliberate deprivation on what amounts to no grounds whatsoever.
Where does the "burden of proof" lie?
Individuals and their representatives should remember that the burden of proving somebody has acted deliberately to deprive themselves in order to claim or increase benefit lies with the Decision Maker. This was confirmed in caselaw in case reference number CIS/40/1989
What if the DWP reasoning looks convincing, but doesn't feel correct?
We would also urge individuals not to be intimidated by the reasoning and arguments that the DWP/UC put forward in submissions (or fail to include in submissions - See this article for advice on how to deal with missing evidence. Just because something looks official or different bits of legislation have been included, it doesn't mean that they are being applied correctly or indeed are even relevant to the case in question.
There are a lot of poor quality and relatively inexperienced Decision Makers/Case Managers working at the DWP/UC and quite often the arguments put forward quoting specific legislation will fall apart once somebody with even a remote understanding of the legislation starts to look at them.
What impact does claimant knowledge of Capital Limits have on a potential decison/outcome?
If the claimant has little or no knowledge of the Capital Limits regulations, then it is possible to argue that the regulations relating to deliberate deprivation of capital should not apply. This was confirmed in the following caselaw CIS/124/1990
However, care needs to be taken in using the above argument if the claimant has been claiming benefits for more than a few months. Case reference CSB/1198/1989 confirmed a view that knowledge of capital limits can be inferred from a "reasonable familiarity with the benefits system"
The effect of health and stress on an individuals financial decision making capacity
Those of us who have been unwell for any length of time will know that sometimes the stress and anxiety caused by being unwell and uncertain about your future can have an adverse affect on the ability to make sound financial decisions. This is especially true of people with mental health conditions.
Case reference CIS/236/1991 recognised that the effects of ill health and stress can lead to unwise decisions in the area of apparently deliberately depriving yourself of capital as well as the importance of the Decision Maker and judge on establishing motive.
In the case CIS/236/1991 a man was accused of "depriving himself" of around £60,000 investing in stock market shares, in order to claim Income Support. At the time his wife was seriously ill which was affected his own health and ability to make sound decisions.
The DWP were alleging that he did not act to minimise his losses when the value of his shares fell and as such was deliberately depriving himself of capital.
In this case it was decided by the judge that the man was too unwell to be expected to be able to make sound financial decisions and that the Decision Maker had not proven that capital had been spent in order to claim benefits
This particular piece of caselaw will be especially relevant for individuals who suffer from mental health conditions, although it would also apply for physical health conditions where a reasonable argument can be put forward that the effects of the health condition affect decision making ability.
If you are being accused or have been penalised in the past under the deprivation of capital regulations we would advise that you seek advice from somebody who understands how to challenge these cases. This is an area of benefits legislation where it is especially important to be be wary of advice and information that is being given by "armchair experts" on internet forums or Facebook groups. Get this wrong and your benefit entitlement can be badly effected and a benefit fraud investigation could follow.
The BASE adviser team will be happy to answer any questions you have on this article or any other benefits questions that you need help and support with.
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