The trail of deceit left by individuals who profited from the Covid-19 pandemic is set to be brought to justice as a newly formed government counter-fraud squad begins its investigations. The Public Authorities Fraud Investigation and Enforcement Service (PAFIES) has been equipped with enhanced powers, marking a significant escalation in the fight against those who exploited a national crisis for personal gain.
The bolstered investigatory tools granted to PAFIES investigators will allow them to conduct searches of suspected fraudsters' premises, seize assets, recover money directly from bank accounts and wages if repayment obligations are not met. Crucially, the timeframe for pursuing civil claims related to Covid-19 fraud has been extended from six years to twelve, meaning investigations can continue until 2032.
These measures come in response to the Chancellor's announcement of the government's response to the Covid Counter Fraud Commissioner's final report, which highlighted the substantial scale of pandemic-era fraud. Initial estimates suggested that £10.9 billion, intended for essential public services like the NHS and schools, was lost to fraudulent activities. To date, nearly 2,000 company directors have been banned and 86 criminals have been prosecuted in connection with these offences.
The government asserts that measures introduced in the 2024 and 2025 Budgets have already protected an estimated £7.5 billion of public money from fraud over a two-year period. Chancellor Rachel Reeves stated that her message to those who owe the public purse is clear: "those who profited, will pay." Satvir Kaur, Parliamentary Secretary in the Cabinet Office, reiterated that those who exploited a national crisis to enrich themselves now have "nowhere left to hide."
These new powers, which will become fully available to the government fraud squad this autumn, build upon the PAFER Act 2025. This legislation not only extended the limitation period for civil claims but also introduced civil financial penalties to accelerate enforcement and enable the direct recovery of fraud-related debts. Individuals who did not respond to the Voluntary Repayment Scheme last year are now expected to face the full force of these new measures. A Covid-19 fraud reporting website, launched in September last year, has already received over 1,000 reports of suspected fraud.