Difference between revisions of "Welfare Overpayments and Fraud (21:VII)"

If a person receives any form of welfare benefit or supplement that he or she is not entitled to, those benefits are considered to be an overpayment. Overpayments can range from a few dollars to tens of thousands of dollars.   '''Many overpayments arise not out of fraud by the  welfare recipient but rather out of an honest error on the part of either the recipient or MSDSI.'''  

When a person has received an overpayment from MSDSI for any form of benefit under the welfare legislation, the overpayment is a debt owed to  the Crown. According to EAA, ss 27-28 and EAPWDA, ss 18-19, the government may recover the debt by deducting funds from subsequent payments of income assistance or pursuing a court action.  

'''NOTE:''' If a client faces a civil lawsuit for a welfare overpayment resulting from failure to provide complete or accurate information,  refer him or her to a lawyer at the Community Legal Assistance Society.   

MSDSI often asks people suspected of having received a welfare overpayment to sign a repayment agreement acknowledging the alleged debt.  Before signing a repayment agreement, clients should ask to review MSDSI’s evidence and its reasons for the determination that there is an overpayment and, if possible, get legal advice or help from an advocate. MSDSI can often make errors in its overpayment determinations. See MSDSI's policy on recoveries and overpayments at http://www2.gov.bc.ca/gov/content/governments/policies-for-government/bcea-policy-and-procedure-manual/compliance-and-debt-management/recoveries

A welfare recipient can appeal a decision by MSDSI that he or she owes an overpayment. However, MSDSI’s decision about the '''amount''' of a person’s overpayment is '''not open to appeal''' (EAA, s 27(2) and EAPWDA, s 18(2)), although a person can apply for a reconsideration of the  amount of an overpayment (for more on reconsiderations, see [[Welfare_and_Health_Supplements_(21:IX) | section IX]] below).  

In ''Newfoundland (Social Services Appeal Board) v Butler'', [1996] NJ No 91, the court held that the Ministry could not recover the monies paid out to Ms. Butler by mistake. Ms. Butler successfully used the defence of change of circumstance. The court held that because Ms. Butler had made expenditures that she would not otherwise have made without the overpayment, it would be unjust to force her to pay the Ministry back. Therefore, it may be that in similar situations, recipients of overpayments will not be obligated to repay social assistance for monies paid under a mistake of fact. Please note that in this case, Ms. Butler reported the income to the Ministry and the Ministry erred in not deducting it.  

Section 31 of the EAA and s 22 of the EAPWDA set out when a person is considered to have committed a statutory offence of welfare fraud.   Welfare recipients can also be charged with fraud under the Criminal Code.   

'''NOTE:''' If a client has been charged criminally with welfare fraud, refer him or her to the Legal Services Society to apply for a legal aid criminal lawyer.