DWP Bank Statement Checks: Could Your Universal Credit Review Lead to an Investigation?

By Prakash Ruparelia, Solicitor, Scott-Moncrieff & Associates

The Department for Work and Pensions (DWP) can ask Universal Credit claimants to provide bank statements as part of a claim review. These checks may look at savings, income, transfers between accounts and other financial activity to establish whether the correct amount of Universal Credit has been paid.

Being asked to provide bank statements does not, by itself, mean that you are suspected of benefit fraud. Many Universal Credit reviews conclude without any change to entitlement. However, if the DWP identifies information that appears inconsistent with a claim, this can lead to further enquiries, an overpayment decision or, where deliberate wrongdoing is suspected, a criminal investigation.

The Public Authorities (Fraud, Error and Recovery) Act 2025 also gives the DWP additional powers to identify potentially incorrect benefit payments and recover certain outstanding debts.

If you have received a request for bank statements, particularly where there are undeclared savings, money held on behalf of somebody else or transactions you are concerned may be misunderstood, it is important to understand what the DWP is looking for and what may happen next.

Why is the DWP asking for my bank statements?

A typical Universal Credit review may involve a request for bank statements through your online journal, followed by a telephone appointment.

The purpose is generally to check whether the information held by the DWP accurately reflects your financial circumstances and whether you have received the correct amount of Universal Credit.

A request for bank statements does not automatically mean that the DWP believes you have done anything wrong.

What does the DWP look for on bank statements?

During a Universal Credit review, the DWP may look at information including:

• savings and other capital
• income entering your accounts
• other bank or savings accounts
• transfers between accounts
• significant payments or transfers from other people
• money you are holding on behalf of somebody else
• transactions that appear inconsistent with information previously provided to the DWP.

The presence of money in an account does not necessarily determine how it should be treated for benefit purposes. Questions can arise about who actually owns the money, why it was received and whether a particular statutory disregard applies.

This can make apparently straightforward bank statement checks considerably more complicated.

Does a DWP bank statement check mean I am under investigation?

No. A request for bank statements as part of a Universal Credit review does not, on its own, mean that the DWP suspects fraud.

However, where statements reveal previously undisclosed accounts, substantial savings or transactions that appear inconsistent with information previously provided, the DWP may make further enquiries.

Where it considers that savings or income have not been correctly declared, it may also examine earlier periods of entitlement. A discrepancy identified during a review of a few months of bank statements can therefore result in requests for several years of financial records.

Depending on what those enquiries establish, the DWP may decide that an overpayment has arisen. In more serious cases, where deliberate non-disclosure or wrongdoing is suspected, the matter may progress to a fraud investigation.

How much savings can you have on Universal Credit?

Under the ordinary Universal Credit capital rules:

Capital below £6,000 does not normally affect entitlement.

Capital between £6,000 and £16,000 can reduce entitlement. Universal Credit is reduced by £4.35 per month for every £250, or part of £250, above £6,000.

Capital exceeding £16,000 will usually prevent entitlement to Universal Credit.

However, these figures do not tell the whole story. There are exceptions and statutory disregards, and questions can also arise about whether money appearing in an account actually belongs to the claimant.

What if money in my bank account belongs to someone else?

This is an area where disputes can arise.

A claimant may, for example, be holding money on behalf of a parent or another family member. Money may also be held in a joint account.

The fact that money appears in your bank account does not necessarily establish how it should be treated under benefit legislation. The DWP may need to consider who beneficially owns the money, and evidence of the underlying arrangement can be important.

Example: money held for a family member

Consider a claimant who has £25,000 in their bank account but maintains that £20,000 belongs to their mother.

The DWP may initially question whether the claimant has exceeded the £16,000 capital limit. The outcome could depend on whether the claimant can establish that the £20,000 genuinely belongs to their mother.

Evidence showing where the money came from, the nature of the financial arrangement and how the funds have been used may therefore become important.

Does inheritance count as savings for Universal Credit?

The treatment of an inheritance will depend on what has been inherited and the circumstances.

Inherited cash will generally count as capital. However, inherited property may qualify for a temporary disregard where reasonable steps are being taken to sell it.

The applicable period is normally six months, although an extension may be reasonable in certain circumstances.

What is deprivation of capital for Universal Credit?

Further difficulties can arise where somebody has transferred or spent substantial sums before claiming Universal Credit.

In certain circumstances, the DWP may treat a claimant as still possessing capital that they have given away for the purpose of securing or increasing their entitlement to benefit. This is known as notional capital.

However, spending money does not automatically amount to deprivation of capital.

The regulations expressly provide that using capital to reduce or repay a genuine debt, or to purchase goods and services where the expenditure was reasonable in the claimant’s circumstances, does not amount to deprivation of capital.

The circumstances and purpose of a transaction can therefore be important where the DWP questions what has happened to previously held savings.

How far back can the DWP investigate a Universal Credit claim?

A Universal Credit review may initially involve only a relatively short period of bank statements. However, if those statements identify a potential discrepancy, the DWP may seek information relating to earlier periods of entitlement.

For example, undeclared capital identified in a recent review may lead the DWP to investigate when that capital was first acquired and whether it should have affected previous Universal Credit payments.

This can result in requests for several years of financial records and, in some cases, substantial overpayment demands.

What are the DWP’s new bank account checking powers?

The Public Authorities (Fraud, Error and Recovery) Act 2025 introduces Eligibility Verification Notices.

These allow the DWP to require banks and other financial institutions to identify accounts meeting specified criteria associated with potentially incorrect benefit payments. Unlike a conventional investigation, the DWP does not need to suspect a particular individual of wrongdoing before these checks are carried out.

The measure covers Universal Credit, Pension Credit and Employment and Support Allowance, but not currently Personal Independence Payment.

Banks cannot be required to provide complete bank statements or transaction histories through an Eligibility Verification Notice. Information received through the process must also be examined before a decision is made about a person’s entitlement.

These powers are separate from existing Universal Credit compliance reviews, where claimants themselves are asked to provide bank statements.

Further information about the operation of Eligibility Verification Notices and the relevant safeguards can be found in the DWP’s Code of Practice.

What should I do if the DWP asks for bank statements?

You should provide the documents requested within the specified deadline or contact the DWP promptly if you require additional time.

Bank statements should be complete and unaltered. Failure to cooperate with a Universal Credit review can result in payments being stopped.

Where your statements contain substantial undeclared savings, disputed ownership of money or significant transactions that may require explanation, it may be sensible to establish the legal position before providing a detailed written response.

This can be particularly important if:

• you have received significant transfers from family members
• you are holding money on behalf of somebody else
• you have overseas accounts
• you have received an inheritance
• you have transferred or spent substantial capital
• you are concerned that previous declarations about your savings may have been incorrect.

An explanation provided during an initial compliance review may become relevant if the DWP subsequently investigates an earlier period of entitlement or considers whether there has been deliberate non-disclosure.

Obtaining specialist advice can help identify the relevant legal issues, establish what evidence may be required and ensure that your response properly reflects your circumstances.

You should not, however, miss a DWP deadline while seeking advice. If additional time is required, you should ask the DWP for an extension.

If the matter progresses to an Interview Under Caution, legal advice should be obtained before attending.

What happens if the DWP says I have been overpaid?

An overpayment demand does not necessarily mean that the DWP’s calculation or underlying decision is correct.

Disputes can arise over issues including:

• the ownership of money
• whether particular capital should have been disregarded
• the treatment of payments into an account
• allegations of deprivation of capital
• the date on which somebody’s circumstances changed
• the period over which an alleged overpayment has been calculated.

Where substantial sums are involved, these issues can have significant financial consequences.

Can the DWP recover money directly from a bank account?

The 2025 Act provides the DWP with additional powers to recover certain outstanding benefit debts.

These include Direct Deduction Orders, which provide a mechanism for the DWP, subject to statutory conditions, to recover certain debts directly from bank accounts without first obtaining a court order.

The powers are principally intended for individuals who are no longer receiving DWP benefits and whose debts cannot suitably be recovered through employment earnings.

Direct Deduction Orders are intended as a last resort. Before making an order, the DWP must follow procedures concerning affordability, financial hardship and advance notification. Affected individuals also have rights to make representations and challenge an order.

Can the DWP apply for a driving disqualification for benefit debt?

The 2025 Act separately provides for driving disqualification in certain serious debt-recovery cases involving outstanding debts of at least £1,000.

The DWP must apply to a court. The court must be satisfied that the individual had the means to repay the debt but failed to do so without reasonable excuse, and that recovery through other available methods is not reasonably possible.

A suspended disqualification order must be made first, giving the individual an opportunity to comply with repayment terms. If those terms are subsequently breached without reasonable excuse, an immediate driving disqualification of up to two years may follow.

The court cannot impose such an order where the individual has an essential need to drive. These powers also do not apply to people who are currently entitled to and receiving DWP benefits.

Importantly, these recovery powers do not mean that someone can lose their driving licence simply because the DWP has requested bank statements or identified a possible overpayment.

How can I challenge a DWP decision?

If the DWP decides that you were not entitled to some or all of the Universal Credit you received, you may be able to challenge that decision.

Claimants can usually request a Mandatory Reconsideration within one month of the decision.

If the decision remains unchanged following Mandatory Reconsideration, you can generally appeal to the independent First-tier Tribunal within one month of receiving the Mandatory Reconsideration Notice.

Where a dispute concerns substantial capital or several years of alleged overpayments, obtaining specialist advice can help establish whether the DWP has applied the relevant rules correctly and what evidence may support a challenge.

Frequently asked questions about DWP bank statement checks

Can the DWP check my bank account?

The DWP has powers under the Public Authorities (Fraud, Error and Recovery) Act 2025 to require banks and other financial institutions to identify accounts meeting specified criteria through Eligibility Verification Notices. These powers are different from a standard Universal Credit review, where the DWP asks the claimant to provide their own bank statements.

Why has the DWP asked me for bank statements?

The DWP may request bank statements as part of a Universal Credit review to check that the information it holds about your financial circumstances is accurate and that you have received the correct amount of benefit.

A request for statements does not automatically mean you are suspected of fraud.

What transactions does the DWP look for on bank statements?

The DWP may consider income, savings, transfers between accounts, significant payments from other people and other transactions relevant to your entitlement.

The treatment of a transaction will depend on its circumstances. A payment appearing on a bank statement does not necessarily mean that it should be treated as income or capital for Universal Credit purposes.

What happens if I have more than £6,000 in savings on Universal Credit?

Capital above £6,000 can reduce your Universal Credit entitlement. Capital exceeding £16,000 will usually prevent entitlement.

However, some capital can be disregarded and questions can arise about whether money appearing in your account actually belongs to you.

What if money in my bank account belongs to somebody else?

The DWP may ask for evidence showing that the money genuinely belongs to somebody else. The legal ownership of money and the underlying financial arrangements can be important in determining whether it should count as your capital.

Can a Universal Credit review lead to a fraud investigation?

Yes, although a review does not automatically mean fraud is suspected. If the DWP identifies discrepancies and believes there may have been deliberate non-disclosure or wrongdoing, it can make further enquiries and may progress the matter to a fraud investigation.

How far back can the DWP investigate?

If a review identifies information suggesting that previous Universal Credit entitlement may have been incorrect, the DWP may seek records relating to earlier periods. The relevant period will depend on the circumstances of the case.

Should I get legal advice before an Interview Under Caution?

Yes. If the DWP asks you to attend an Interview Under Caution in connection with suspected benefit fraud, you should obtain legal advice before attending.

Concerned about a DWP compliance investigation?

If the DWP has asked for your bank statements and you are concerned about undeclared savings, money held for family members, disputed capital or a possible overpayment, specialist advice can help you understand how the relevant benefit rules apply to your circumstances.

Scott-Moncrieff & Associates advises and represents clients facing Universal Credit compliance reviews, disputed capital, substantial benefit overpayments, DWP fraud investigations, Interviews Under Caution, and tribunal appeals.

Contact Prakash Ruparelia, Solicitor-Advocate, through Scott-Moncrieff & Associates to discuss your circumstances and the legal options available to you.