The Department for Work and Pensions (DWP) has confirmed that banks will be required to begin monitoring millions of accounts from April 2026, as part of what it calls the biggest fraud crackdown in a generation. The new powers, created under the Public Authorities (Fraud, Error and Recovery) Bill, aim to identify benefits cheats by flagging accounts that may breach rules, such as holding more than the £16,000 savings limit for Universal Credit.
Under the scheme, officials will not have direct access to detailed transactions but will receive alerts from banks when accounts raise suspicions. The DWP claims the measure will save taxpayers £1.5 billion over five years, following record losses of £7.4 billion from benefits fraud and error last year. A fact sheet from ministers stressed that information shared will not be based on any presumption of guilt.
However, critics warn the plans could lead to mass financial surveillance of claimants and unfairly penalise vulnerable households. Silkie Carlo, director of Big Brother Watch, described the powers as a disaster for financial privacy and the presumption of innocence, calling it an unprecedented regime of intrusive generalised surveillance.
The law also grants the government tough new powers to recover money from fraudsters, including taking funds directly from bank accounts and, in cases of persistent refusal to repay, banning offenders from driving for up to two years.
