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Mattress Cash(44 Posts)
Let's say this is purely hypothetical.
Okay. So imagine an uncle finally counting up the cash he's been saving for about 30 years under his mattress. Housing Benefit/Dole been claimed for the past 15 years MINIMUM. Both Uncle and Aunt been some small cash in hand work. Uncle doesn't leave the house otherwise and spends nothing. Bills always been paid from dole/pension and Aunts cash in hand.
Total is about £35K.
Aunt whacks £10K in one bank account and opens another with another bank in order to put £20K in that.
It's going to be noticed, right? I'm assuming worst case scenario would be demands from tax man and repayment of benefits for... well forever?
The hypothetical aunt and uncle refuse point blank to seek any advice, not even CAB.
Criminal offences may have been committed - no rights to benefits if savings are more than a certain amount and tax evasion on the cash in hand wages if tax hasn't already been deducted by the employer and the employee hasn't filed a tax return themselves. Up to £1000 of interest can be earned before tax is payable now. Why have the savings now been banked? Although safer to bank the money, the risk is creating an audit trail. Which of this post are hypothetical?
I don't know whether seeking advice would expose the fraud. Don't assume those involved don't know they are likely to have committed a crime.
The hypothetical money is being put into banks because after finally counting it up, hypothetical aunt and uncle are nervous having that much cash in the house.
Aunt and Uncle don't consider what they've done is illegal. They are also positive that splitting up the money between various banks that it would go unnoticed.
For housing benefit you have to declare what bank accounts (and amount in them) you have. The LA can request account information directly from banks and/or building societies.
Large cash deposits with no identifiable source are likely to lead to a bank reporting the deposit to the NCA. If the NCA received multiple reports from different banks, this makes it look more suspicious and more likely they will investigate. However, as they are concerned mainly with money laundering, terrorist financing and the proceeds of crime, I doubt they would look into benefit fraud.
One point though is that if they've been doing this for years, lots of the notes have ceased to be legal tender so the bank won't accept them. They can exchange them at the Bank of England, but given what you've said I doubt they would do that. Karma, some might say.
Apparently all notes have been exchanged over the years. This idea to finally bank them has something to do with the last bunch of notes becoming useless after March 1st:
Lenders will be obliged to report transactions over a "certain amount" to HMRC as part of the money laundering regs. If the fail, it can be (big) jail time for the employees*
I think "a certain amount" is currently £5K, BICBW.
Once reported, HMRC might require provenance of the cash, or it's forfeit.
Similarly, POCA gives the police powers to seize cash and demand to know it's provenance. Again, failure to respond means it's forfeit.
It clearly isn't hypothetical OP though I would guess you don't know the sums involved or all circumstances!
It used to be a lot easier to work cash back into the system.
One way forward is to buy purchase a life insurance policy with the cash, say £20K. When they ask where it is from, explain it's your life savings which you now realise is not save to keep in cash. Cancel the policy well within the fourteen day cooling off period and they will issue a refund cheque. You can then open a bank account / pay in the funds from the policy.
For the sake of increased anonymity online plus the fact that I know that if this weren't "hypothetical" I could also say that the terms aunt and uncle may be in question too. As for amounts involved and circumstances, they could very well be spot on, such as knowing for a fact about benefits claimed from up to 15 years ago and the exact amount of cash counted. I will concede that it may not be a mattress the money was kept under 🙄
It's really frustrating knowing that this is likely all going to end in tears because they are so set in their ways and stubborn that they will not listen to reason and refuse to believe that they have defrauded the benefits system for all theses years and that the system will have every right to reclaim everything back. (Where's the tearing hair out emoticon?!)
I would have thought the bank would ask questions if a sudden out of character lump sum of cash was paid in?
Any bank / building society (at least in the uk) will routinely ask for the origin of any large cash sum. However, its largely a box ticking exercise, so if a plausible answer is supplied, it is highly unlikely that further enquiries will be made
They should start spending it until lower than any threshold. Then they can pay it in without any hassle.
Tbf they must have been living very frugally to amass that amount from benefits and a little cash in hand work
There is nothing wrong with having saving in cash, the problem they now have is the benefits rules re savings.
However, its largely a box ticking exercise, so if a plausible answer is supplied, it is highly unlikely that further enquiries will be made
Until an employee goes to jail.
Not frugally as such, the uncle never left the house other than to do regular small cash in hand jobs (think £5 to mow a lawn or £50 to erect a shed) but not a penny went to household bills. He also never stepped foot in shops. Ever (he'd think a can of coke is still 20p)
30 or so years of that adds up. Benefits pays rent, council tax and bills. Extra spends were the wife's earnings from regular part time CIH. (Think cleaning etc)
I hope you're right @FinallyHere as due to their age I would think the banks would certainly find it plausible that it would be savings. It's becoming less common for people to squirrel cash away at home and not trust banks but I know my own grandparents did that very thing.
I'm probably wrong but I seem to remember a friend who worked in a bank said ( many years ago ) that a large deposit put into an account would be automatically flagged up to various agencies in the prevention of money laundering , fraud and other such crimes , I believe the amount then was £6k although it's probably more now
When I worked for a bank any cash deposits of £1,000 or more were looked at and thought of as suspicious. This might not still be the case, and might vary from bank to bank. Could your aunt and uncle buy lots of gift cards - £200 each from supermarkets and every store on the high street. Or buy a small flat or caravan somewhere. Or change the money into dollars and euros, then change back again at a later date.
I believe the amount then was £6k although it's probably more now
I have heard £3K ...
When the money laundering regs were tightened up, I was working in estate agency software. We had to ensure that nothing was allowed until the clients identity and funds had been checked. (There was a thread on here a while back where a poster was very huffy that they had to be vetted)
Another idea - if they have the space at home they could buy lifetime supplies of lots of non-perishable goods - all toiletries, pots and pans, cleaning stuff, non-perishable foods (some foods last 10 to 20 years, some have an indefinite shelf life). Or buy anything they can buy and re-sell for the same price or more at a later date.
what Ariadne said - they're committing benefit fraud by continuing to claim while having large savings. Which since they apparnetly don't want or need the large savings, they can stop the claims.
(in answer to the bank question - yes money laundering regs will clock a large deposit or series of smaller ones making a large one)
Agree with Aridane, and think themselves lucky their long-term fraud hasn't been discovered.
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