See I'm agreeing with both the YABU and YANBU here, that is why I'm in two minds what to do. It is wrong, no matter who is doing it, but anyone else I'd probably be having a quiet word along the lines of- 'I know you are doing this, we both know its wrong etc......' But there is no way I'd approach this colleague the same way. People have had strip torn off them in the past for mentioning far less serious stuff, there's no way I'd go there. I was also not shocked to find this out about her, where I would have been about anyone else.
I'm not a nasty person by nature. I truly don't want to ruin anyone's life. Last night I wrote out a long, wine-fuelled rant reply, detailing all the many horrible things she has done, the major problems (including at least 2 very serious ones relating to children) her laziness and incompetence have caused, and the other instances of abuse of company resources. It felt good to let it all out and has made me realise how big a problem there really is here, but it also felt mean and spiteful too, so I deleted.
I think its clear to me now though that reporting the benefit fraud (I've checked the website, tax credits do come under this umbrella term) will come to nothing. SHe knows how to play the system and any investigation would be impossible. Then the risk that it would come out I'd reported would cause huge problems for me. I'm not willing to lose my job over this.
Similarly I don't think trying to alert the manager will work either. Although this colleague is technically only the same grade as the rest of the team, in effect she is part of the management. She has always seen herself as being 'above' the rest of us and has manipulated her way into a position of authority (and of course higher wage/smaller workload) over all of us. In her own words 'she runs the shop' and it would be very difficult to make any complaint without going through her first.
Going above her head isn't likely to work as the manager currently works remotely. All calls and post go through this colleague first and she has access to the manager's emails. One other person has made an official complaint about her in the past. That person was absolutely ripped to pieces and had their life made hell at work, while the complaint was dismissed and the fraudulent colleague came out looking like the victim. Reporting colleague left very soon after.
So I think my mind is made up. I'm not going to report anything to anyone. It's not worth the risk IMO. I'll just have to manage the guilt at doing the wrong thing and worry that I could end up implicated. Though it will break my heart to leave this job, as I love it and have been here nearly 6 years, I'm going to focus on finding another job instead. Anything as long as I can make it fit around our family, is better than remaining in this position.