Personal Public Service numbers: The use of bogus PPS (Personal Public Service) numbers for claiming welfare benefits may be costing the State in the region of €50 million a year, according to the Comptroller and Auditor General's annual report.
An internal investigation by officials at the Department of Social Affairs found many PPS numbers had been obtained using false documentation or were being used by people to whom they did not belong.
The consequences, according to the report, mean that bogus PPS number-holders are able to draw welfare benefits, obtain credit cards and bypass the work-permit system.
An evaluation in 2000 tested a sample of more than 1,500 PPS numbers issued to people from EU applicant countries. Ten per cent of these turned out to have been fraudulently obtained, along with a significant number of other "suspicious" cases.
A more recent analysis of fraudulent cases for 2004 found 303 of the applications were from non-nationals who presented false documents purporting to be from EU states. Four internal and external reviews and audits have been carried out on the system over the last five years and these have raised serious issues relating to the processing and registering of applications for PPS numbers. An internal evaluation in 2000 estimated losses at €25 million to €50 million per year.
However, the department's accounting officer said estimates of losses of between €25 and €50 million were "highly speculative".
The audit that uncovered this number had been carried out soon after the department had taken sole control of the registration process.
"The estimate was highly speculative and based on the possibility of fraudulent claiming rather than on actual experience," the accounting officer said.
The four reviews raised a number of problems with the methods used to allocate PPS numbers, the C&AG's report said. The system's name-check facility, which is used to ensure that a PPS number has not already been allocated, was not applied to non-nationals because the system did not recognise foreign names.
The reviews also warned that, given that PPS numbers were used to open bank accounts or obtain credit cards, the system could be discredited.
The C&AG warned that it was "vitally important" that staff in welfare offices and other settings had sufficient backup available to them and the support of a tried and tested quality assurance system to combat instances of identity fraud.
The department's accounting officer said significant measures had been and were being taken to deal with both the results of the historical shortcomings in the PPS system and with future challenges in this area.
