Folkestone & Hythe District Council’s £1.26m Fraud Report Doesn’t Say How Much Was Fraud — or Error

There’s a rather important word hiding inside Folkestone & Hythe District Council’s latest £1.26 million fraud figure.

“Or.”

FHDC says its investigations team dealt with 1,126 cases during 2025/26 and recorded 466 cases where “Fraud or Error” was proven, producing a stated financial impact of £1,266,259. What the council doesn’t tell residents is how many of those 466 cases were actually fraud, how many were simply errors, or how much of the £1.266m belongs to either category. Its Easy Read version does exactly the same thing, recording “466 fraud/errors identified” alongside the £1,266,259 total.

That distinction isn’t nit-picking. Fraud means deliberate dishonesty. An error can be just that: somebody getting something wrong.

So the documents don’t support saying FHDC uncovered £1.26m of fraud. They support saying its investigations identified £1.26m of combined financial impact across cases classified as fraud or error — without telling us how the cake is sliced.

And once you start slicing it, the headline number becomes more complicated still.

Council Tax accounted for £747,683. FHDC investigated 954 cases involving discounts, exemptions and Council Tax Reduction and recorded 402 findings of “Fraud or Error Proven”. Again, there’s no split between deliberate fraud and mistakes. Of that £747,683, £316,419 relates to savings attributed to a future year rather than money already recovered: £145,584 for discounts and exemptions and £170,835 for Council Tax Reduction.

Then there’s housing.

FHDC investigated 23 tenancy-fraud cases and recorded eight findings, worth £336,000. But that £336,000 isn’t £336,000 sitting in the council’s bank account. FHDC applies a nationally recognised notional value of £42,000 to each case, intended to reflect the value of returning a social home to proper use, including reduced waiting-list pressure, temporary-accommodation savings and wider social benefits. Eight multiplied by £42,000 gives the £336,000.

There’s another wrinkle here. The Easy Read summary calls these “8 frauds identified”. The main report puts the same eight outcomes beneath the column “Fraud or Error Proven”. Those descriptions aren’t quite the same thing. If all eight were proven fraud, the council could simply say so consistently.

Housing Benefit adds another £182,535. There were 148 investigations and 55 findings. Yet once again the table combines them as “Fraud or Error Proven”; it doesn’t tell us whether those 55 comprise, say, 50 frauds and five errors, five frauds and 50 errors, or something in between. Nor does it disclose what share of the £182,535 represents fraud as opposed to error.

Put the future-year Council Tax figures together with the £336,000 notional housing figure and £652,419 — 51.5% of FHDC’s £1.266m headline — is either future-year or notional value. That still leaves genuine financial consequences elsewhere, but it demonstrates why “financial impact”, “savings identified”, “money recovered” and “fraud detected” shouldn’t be used as though they mean the same thing.

The really interesting bit appears when we wind the clock back.

FHDC has been producing these annual Investigations and Fraud Overview reports for years. Its archive contains reports for 2022/23, 2023/24 and 2024/25 before this latest 2025/26 edition.

The same reporting problem runs through them.

In 2024/25, FHDC investigated 815 Council Tax cases and recorded 303 under the combined heading “Fraud or Error Proven”, identifying £467,590. Tenancy fraud added 42 investigations, six findings and £252,000 of notional savings. Housing Benefit produced 248 investigations, 72 findings and £77,339, while four Household Support Fund cases produced four findings and £600. Adding FHDC’s published categories gives 1,109 investigations, 385 fraud-or-error findings and £797,529 of identified financial impact.

That means the latest year saw only 17 more investigations than 2024/25 — up about 1.5% — yet recorded 81 more fraud-or-error findings, up 21%. The published financial impact rose by £468,730, or 58.8%, from the £797,529 obtained by adding the previous year’s categories to £1,266,259 in 2025/26. But because both years mix fraud with error, notional savings and future-year savings, that rise still isn’t evidence that fraud itself jumped by 58.8%.

Go back another year and the pattern remains. In 2023/24, FHDC reported £520,243 from Council Tax work, £294,000 of notional tenancy-fraud savings and £215,201 from Housing Benefit — £1,029,444 when those three published figures are added together. The report again labelled outcomes “Fraud or Error Proven”.

So over the three latest reports, the published financial-impact figures move from about £1.029m in 2023/24, down to £797,529 in 2024/25, then up to £1.266m in 2025/26. What we still can’t extract from those reports is the number that arguably matters most in a document carrying the word “Fraud” in its title: how much proven fraud was actually detected.

FHDC’s separate Transparency Code webpage takes the history back further. It records 1,510 “fraud/irregularity” investigations in 2019/20, 1,398 in 2020/21, 1,281 in 2021/22, 1,183 in 2022/23, 1,366 in 2023/24 and 1,109 in 2024/25. It also shows annual counter-fraud expenditure rising from £44,697 in 2019/20 to £52,969.20 in 2024/25. But that page, too, gives the number investigated without publishing separate totals for fraud identified, irregularity identified, their respective monetary values or amounts recovered.

That’s particularly notable because the Government’s Local Government Transparency Code says councils must publish basic counter-fraud information and recommends that they go further. Paragraph 68 recommends publishing separately the number of occasions on which fraud and irregularity were identified, “the total monetary value of a) the fraud and b) the irregularity that was detected”, and the amount of each recovered. It’s a recommendation rather than one of the Code’s mandatory minimum requirements — but it describes almost exactly the information missing here.

There’s a local history to the housing side as well. The Shepway Vox Team reported in January 2023 that Companies House addresses could be matched against council-tenancy records to produce leads for investigation. We returned to the issue in  July 2026 after finding four active companies registered at three addresses within FHDC housing schemes, while stressing that a company registration at a council-home address isn’t evidence of fraud and may have an entirely innocent explanation.

That matters because FHDC’s dedicated 2022/23 tenancy-fraud audit received Limited Assurance and generated 12 recommendations. The council’s March 2026 audit plan still lists the last tenancy-fraud audit as 2022/23, the assurance as “Limited” and the follow-up as “To do”.

None of this diminishes the value of catching incorrect claims, finding undeclared properties, tracing debtors or getting council homes back into legitimate use. In 2025/26 alone, KIN information led FHDC to 27 newly chargeable residential properties with £17,021 in annual Council Tax, while 17 absconded debtors were traced and £11,015 returned to collectable debt.

But transparency works both ways.

The problem isn’t the £1.266m figure itself. It’s what FHDC has bundled inside it. Fraud and error are rolled together, while the financial impact also includes future-year savings and £336,000 of notional tenancy-fraud savings. From the published figures, residents simply can’t tell how much money was lost through deliberate fraud, how much resulted from mistakes, how much has actually been recovered, or how much represents savings that may arise later.

For something called an Investigations and Fraud Overview, that’s a pretty fundamental omission. FHDC can legitimately say its investigations produced a stated financial impact of £1,266,259. What the report cannot tell us is the value of fraud actually uncovered, because the council hasn’t separated fraud from error.

And after years of publishing these reports, that remains the missing number: how much fraud did FHDC actually find?

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The Shepway Vox Team

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