Bulgarian gang behind Britain’s biggest benefits fraud to repay only a fraction

– This article will make your blood boil –

A Bulgarian gang behind Britain’s biggest benefits fraud will have to pay back only £2m of its £53m haul despite admitting it moved cash abroad.

Galina Nikolova, Tsvetka Todorova, Gyunesh Ali, Patritsia Paneva, and Stoyan Stoyanov were jailed for a combined 25 years in 2024 at Wood Green Crown Court.

All of the gang, apart from Ali, have now been released from prison and are on immigration bail waiting to be deported.

They should have been removed months ago but were not allowed to leave until confiscation proceedings against them had concluded.

Following their arrests, prosecutors seized around £1m in cash from the defendants’ home addresses, but pursued the gang for further money held in property and bank accounts.

The gang made false benefits claims for Universal Credit with an array of forged documents that used the identities of real people, who were living in Bulgaria, complicit in the scheme and who received a share of the money.

The total amount they stole was said by prosecutors to be £53m. The real figure, however, is believed to be far higher.

Police in Bulgaria told The Telegraph they believed the fraudsters were making around £200m a year.

At a hearing at the court in December, prosecutor Gareth Munday outlined the efforts of the Crown Prosecution Service and the Department for Work and Pensions (DWP) to recover the money.

He said: “The criminality that backs this offending was substantial, sustained and business-like fraud committed against the DWP. It resulted in a loss to the public purse of many millions of pounds.

“The Crown has taken every effort to regain as much money as we could.”

Mr Munday explained that the total amount of money stolen was not the amount directly obtained by the gang.

They took a cut of the money when processing claims for people in Bulgaria and effectively acted as “agents”, the court heard.

Mr Munday said: “A defendant cannot be held liable under the [Proceeds of Crime Act] for losses they themselves did not obtain.”

The prosecutor said: “Although the public may hear a loss figure of many millions, the benefit was much lower.”

The court heard that Nikolova, one of the ringleaders, had processed fraudulent claims on behalf of at least 2,400 people.

On average, she received around £830 in “commission” from “clients”, Mr Munday said.

She charged £80 for a National Insurance document and £60 for false tenancy documents. She also offered to provide fake job references and GP letters.

Some of the claims Nikolova was processing, however, related to people who did not really exist, the court heard.

“If money was obtained from the Department for Work and Pensions for people who never existed, where did that money go?” Judge David Aaronberg KC asked the prosecution.

Mr Munday said that some of the money had been moved into bank accounts “created for the purpose of those claims” but they had been unable to link them to Nikolova or any of the other defendants.

When she was arrested, police found £750,000 hidden in a mattress and stuffed behind a fridge at her home.

Mr Munday said that the Crown had investigated what assets the defendants had available both in the UK and overseas.

Prosecutors had wanted to recover around £4m from Nikolova. But they could only prove Nikolova made around £2.8m from the fraud and she had available assets of just £942,183.

Judge Aaronberg asked: “What has happened to the balance? Where has it all gone?”

The prosecutor said that the money was accumulated over five years, the “difference has been spent” and there was no realistic prospect of Nikolova being able to pay it back.

The court heard she had several properties in Bulgaria that would need to be sold.

“Literally millions has not been recovered,” the judge said.

Mr Munday said that the amount the prosecution were seeking was what they could “realistically trace”.

He accepted that Nikolova admitted she had moved “money in cash overseas”.

Nikolova’s partner, Stoyanov, worked as her assistant and was ordered to pay back £7,654 despite making at least £162,950.

Paneva, who had more than £80,000 in her bank and £20,000 in cash at her home when she was arrested, made at least £225,919. She was ordered to pay back £99,235.

Judge Aaronberg ruled that if the prosecution was satisfied this was the total that could be recovered from each defendant, the confiscation amounts were “appropriate”.

Ali, the only defendant remaining in prison, and Todorova will face separate confiscation hearings later.

Ali, who part owns a cafe in Bulgaria’s third largest city, Plovdiv, is believed to have large amounts of money hidden in crypto currency.

After the confiscation hearing concluded, Nikolova said: “I can’t believe it. I get to go home. I am very excited.”

A Department for Work and Pensions spokesman said: “We take all fraud seriously and last year we saved an estimated £25bn through our prevention and detection activities. In this case, action is ongoing to recover further money.”