Expat Benefit Frauds: It’s Not Really Benefitting Us

Unless you’re one of us yourself, the world of expats is probably this big black hole of visas, tax issues, remittances and more that you can’t be bothered to concern yourself with. And I can’t blame you – expat issues aren’t something anyone would choose to read up on in their free time. However, as the world gets “flatter and flatter” and borders become more and more blurred with people working remotely and moving overseas, the number of expats is exponentially increasing. Unfortunately, so is the number of expat benefit frauds, which really can affect regular taxpayers, expats or not. And that’s why it’s important for you, dear reader, to be at least slightly aware of the happenings in the world of expatriates.

Let’s start with the basics: Who exactly qualifies as an expatriate? In simple terms, and as explained by Investopedia, an expatriate is “an individual living in a country other than their country of citizenship, often temporarily and for work reasons. An expatriate can also be an individual who has relinquished citizenship in their home country to become a citizen of another.” For example, if you are a US citizen, and your company sends you to their office in the UK for a long period of time, you would be considered an expatriate. As of May 2013, the State Department of the US estimated that there were more than 7 million US citizens living abroad. BBC estimates that there are around 5.5 million British people who live abroad.

Unfortunately, not all expats have strong moral tendencies. In fact, judging by the amount of benefit frauds committed, it is almost as though there is purposeful disregard for the law since the chances of getting caught while overseas seems less.  What exactly is a benefit fraud then? In basic terms, this is when those living abroad try to claim money in their home country. You might have heard of one high profiler, Dean Stuart Ahmed. Ahmed continued to claim “disability benefits”, while he was secretly building a portfolio of luxury properties over 15 years! This is no small joke. According to the Department of Work and Pensions (DWP) in the UK, during the last fiscal year, approximately 82 million pounds were lost as a result of benefit fraud overpayments to expats who failed to mention that they were living or traveling abroad. That’s 82 million pounds of taxpayers’ money.

Stack-Of-Money, Fraud, Hand Over Fist

Image: Vectorhq.com

This year, with more people leaving to retire abroad, the British Government has decided to crackdown on those living overseas. The DWP has clearly stated that falsely taking payments, and failure to report a change in living circumstance could lead to prosecution and a jail sentence. While some may not think that going abroad and claiming certain benefits is a serious crime, it essentially amounts to theft, which is of course taken seriously by the law. The above-mentioned Dean Stuart Ahmed for example was jailed for 32 months and his property was taken away. With Spain being the top destination with the highest number of fraud cases, the DWP has set up a special team a free hotline to report fraudsters in Spain.

Though expat benefit frauds might seem like a distant problem to the regular citizen, the large amounts of taxpayers’ money being diverted and lost proves that it is not. With the constant rise of technological innovations that bring us closer and closer together, and the increasing ease of travel, one can only conclude that the number of expatriates will multiply. We can cross out fingers and hope that these frauds also do not multiply, but in all probability, this will not be the case. Instead, being aware of the risks of expat benefit fraud enables us to put into place necessary measures to control it, and prevent it from becoming an even bigger problem.


Akshata MehtaAkshata is a freelance writer who majored in International Political Economy and English Literature, with a passion for exploring the world. She has lived abroad for many years and has had many wonderful adventures with different types of food. Occasionally, she writes about not-so-serious stuff and her daily doings on her blog here