UC fraud (?)- what do I do?

[anxiousship]

Hi all
I need advice, I am a total trainwreck and can't get my sh&^ together on how stressed I am now.

I work full-time, single mother, renting, my child is disabled.
I have applied for UC 2 years ago and declared the savings I had which was £10k, was getting UC every month since then. UC would contain of disabled child element, single parent, rent and childcare and deduction for the 10k savings.

UC could see my salary every month through the NIN or wherever they get the information from. I was never contacted by UC for any questions and the only time when I needed to log in is to declare childcare costs ( wraparound care). I live in London and the rent is quite high so is the childcare (around £400 a month), so I was getting around £600 a month despite me working full-time on a "good-ish" job, which was a massive help.

Yesterday I was reading a random article about savings and what classified as savings and I realised that the Young Saver account which I have opened years ago for my child, where I and my ex-husband transfer money monthly) has to be declared too because even though it is a Young Saver it is on my name and I have access to the funds. I have realised that because of that and me not declaring it I have committed a massive fraud as I did not declare my savings in full!

When I opened UC account, it was around £4k in savings in Young Saver, but it grew to over £6k in savings in the last year or so which means that last year or so I should not have been eligible for UC at all due to the £16k threshold, meaning that I unintentionally committed a fraud!

I am sure when I opened the UC account it said that child accounts does not count as savings but I never read the "small prints" that if it is on my name, even if it is a Young Saver it should have been! I am mortified. I think it is only some children's account like trusts which are disregarded, which is not my case ( I know now!).

So in the first year I should have reported around 14k in savings instead of 16k in savings so I would be still eligible for the UC just it would be reduced more according to 14k savings and not 10k savings but in the second year when it would go to 16k over I would not be eligible for it at all and I was getting it!

I had a massive meltdown and panic and I went to my UC account and declared the change in savings backdating it to almost a year ( it is hard, because between 3 accounts I do not know when exactly the threshold went over the 16k) also, between then and now there were times when it would be under the 16k due to outgoings from my current account, but STILL I should have declared it because I had more than 10k in savings which I declared from the beginning.

Again, I feel so guilty and so mortified on what will happen now. As I said, I declared it on my UC account and I also added a message in my journal explaining all I have explained here, that I simply thought that Young Saver is not classified as savings except for now I know it does. I obviously mentioned that I am happy to repay it all back and that it was a genuine (stupidity) mistake and I do apologise.

Some people online said "just go and take out cash" but I did not want to do it because I was planning to buy a little flat on 5% mortgage and I need 14k for that anyway, so I do not want to do anything illegal.

I am ready to give all the overpaid money back and of course my UC account being closed, but will I be prosecuted? will I go to prison? I have no family in the country and who would look after my disabled child if they sent me to prison?

I have called the UC advice line crying but they just said that "mistakes happen" and that I did the right thing on reporting it now and leaving a message in the journal explaining all that and they were empathetic and said that I won't go to prison, but I am totally devastated, I really did not realise that I am a fraudster. Am I?

Any advice would be much appreciated. Please do not beat me too much, I really did not know that I am so bloody stupid.

What is next? I guess they will need my bank statements for two years or so and start investigation? How can I and what do I do to avoid the prosecution ( court and prison) , I will of course pay all I owe back ( I know they take it in installments and pay the fine if needed).

@anxiousship just curious whether you had an update you'd be happy to share?

I have had an appointment and I have brought all the statements required ( took me a day printing it lol). I was very nervous. The lady did not have a clue on if the child's account will be counted or not. She said all the statements will go to the decision maker and it might take weeks or months. She was polite but neutral. She said try not to worry too much.

I have obtained the letter from the bank proving that the child's account (trust) is belonging to the child and the child is the beneficiary according to the para H107/H108 ( quoted earlier) and I have provided this to the UC too.

I have also asked the lady to explain on how to calculate the capital and when to report it, as an example: I receive a salary and my son's DLA and I still have money in the current account and the rent and bills has not come out yet, at this stage what will classify as savings, etc. Another example: when do I actually declare how much I have each account ( mainly current account as spendings are different each month and do I literally do it every month or what else)... And she did not have a clue, she said literally something like "Oh, I don't know, it is a very difficult one"... In my head I thought " well if it is difficult for you and if you do not know the rules, how would I know how to declare it and how to do it correctly and how often/when"

Then yesterday, ( on Saturday!) I receive a message in my journal saying that they looked at what I have provided and have not included my child's account ( hallelujah, I thought, as this was my biggest worry) and then I read the letter and... they also have not included my savings account, meaning they now have my savings calculated less than 10k which I have always declared... obviously it is their mistake and I do not want to be overpaid even more, so I of course replied to that message saying that they have forgotten to include my ( not child's) savings account and please include that as I have declared at all times and provided the statements too.

Basically it feels like

1. I am an total idiot wreck, who created the problems myself by reporting something I should not have reported and then driven myself crazy ( aka anxiety)
2. The rules and regulations are poorly understood which can cause problems in the future but those problems would be my (our) problems...
3. It would really help if people/advisors would have the knowledge what decision makers have in order to provide an accurate advice and guidance.

So the story is to be continued...