Tens of millions of pounds have reportedly been stolen by fraudsters as a result of a universal credit scam that has left affected claimants up to £1,500 out of pocket.

The Department for Work and Pensions (DWP) is under to pressure to explain what it intends to do to counter a scam in which criminals obtain claimants’ personal details, often by posing as DWP staff, to make bogus online applications for universal credit.

According to a BBC report, contributors to an internal DWP staff forum estimate the losses so far could amount to as much as £20m, with hundreds of bogus claims every day for advance loans of up to £1,500. The DWP said it questioned the figures, but could not say if it had different estimates.

Once the claim is established the scammers can apply for, and take a cut of, an advance loan of hundreds of pounds routinely offered to new claimants to get them through the minimum five-week wait for a first payment.

In other cases in which claimants’ details are obtained without consent, the first the claimant becomes aware of the scam is when they receive a letter from the DWP telling them their existing benefits have been cancelled, their universal credit claim has opened and they must repay the advance loan.

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