Greedy fraud trio made £2m out of banks and councils

The trio, who worked from a derelict house in South Yorkshire, illegally netted 278,000 in housing and council tax benefits and obtained 915,000 in loans from banks using hundreds of false identities.

They were only caught after the daughter of a girlfriend of one complained to her local council in Whitby that she was 5 short on her housing benefit.

That sparked an investigation which ultimately led officers to the large criminal operation based in a tumbledown Sheffield house where secret records detailed the conspiracy to defraud the benefit system and credit facilities of millions.

Investigators believe David Smith, 56, and Susan Clarke, 49, both of High Green, Sheffield, and Dennis Morris, 56, of Port Mulgrave, Whitby, could have obtained more than 2m.

Sheffield Crown Court heard Smith and Morris owned two properties in France and the fraudsters took holidays in Australia and other exotic locations with the proceeds.

Jailing the trio yesterday after hearing about their web of lies and deceit, Judge Trevor Barber told them: "You are all three greedy and all three thoroughly dishonest."

Their complex identity fraud involved benefits, loans, credit card accounts, cheque book accounts and driving licences.

Andrew West, prosecuting, said Sheffield, Rotherham and Scarborough councils, High Street banks and the DVLA had all been victims of the scam which began in 1992 and ran to 2008.

Smith and Morris were the masterminds, with Clarke joining them at a later stage. They used false names and addresses and kept one step ahead of the authorities by constantly moving from house to house.

The inquiry started when a discrepancy was found in a housing benefit claim to Scarborough Council for a home linked to Morris in Long Row, Port Mulgrave.

It was discovered that Morris was at the same time fraudulently claiming housing benefit from Sheffield Council at a two-bedroom house he had in Vickers Road, in the city.

Fraud investigators found more than 50 false names linked to that address and 11 people listed for it on the electoral roll, although Morris was the only occupant.

Numerous other addresses were discovered linked to credit accounts and loans that had defaulted and further false benefit claims.

Three offshore bank accounts were found – yet no bank accounts had been declared to the Department of Work and Pensions (DWP).

In total, more than 230 false names were created at more than 40 addresses in South Yorkshire. When one address had been exhausted, the defendants moved to another address, usually rented, and had mail re-directed.

Smith and Clarke were finally arrested at a three-bedroom detached property in Mortomley Lane, High Green, Sheffield.

Next door, at a derelict house owned by Smith, police stumbled across an office hidden in a loft. It contained box files, bank records and financial documents, many with the false names already set up.

Mr West said: "The police were about to leave when they noticed an electrical cable going from the first floor to the loft. It was effectively being run as a business and was where the records were kept so they didn't trip themselves up."

Smith, Clarke and Morris all admitted conspiring to defraud Sheffield Council, Rotherham Council and Scarborough Council for housing and council tax benefit from November, 1995, to December, 2008.

They all admitted conspiring to defraud banks by fraudulently obtaining bank accounts, credit cards and loans by using false names from January, 2000, to March, 2009.

Smith and Morris admitted conspiring to defraud the DWP by making false claims from November, 1995, to December, 2007 and conspiring with others to conceal the cash proceeds of crime.

Smith further admitted possessing a 1934 Beretta pistol and two CS gas canisters.

Smith was jailed for five years, Morris for four years and Clarke was given 21 months in prison.