December 2016

9.7 Controlling Fraud

Legislative Authority

Sections 57, 58 and 79 of the Act.
Section 65 of the Ontario Works Regulation 134/98

Audit Requirements

Documentation is on file to support decisions resulting from eligibility investigations and appropriate calculation of reduced assistance.

Documentation and tracking of eligibility investigations is in accordance with provincial standards.

Random file reviews are completed to ensure that all requirements are met.

Application of Policy

No person should knowingly obtain or receive assistance, or aid or abet another person to obtain or receive assistance to which they are not entitled.

The Administrator determines if there are reasonable grounds to suspect that fraud may have occurred.

The Administrator may establish a local fraud control unit and may designate staff as Eligibility Review Officers (EROs) to assess and investigate an applicant or recipient's eligibility for assistance. Proper processes and procedures must be in place for staff to follow.

All allegations of fraud from internal or external referrals for investigation should be entered into the Social Assistance Management System (SAMS) according to local protocols. First Nations delivery agents should document referrals in the file system used by the delivery agent.

Assessment and Investigation

Eligibility complaints may be received from either external or internal sources. Complaints may include fraud allegations from the public (the public may contact 1-800-394-7867 for any allegations of fraud) or cases that have been referred by staff when apparent discrepancies have been discovered through activities such as data matching or file reviews.

The Administrator should designate staff to complete a preliminary review of the case within 30 calendar days of receiving a complaint.

The preliminary review involves:

  • verifying that the recipient is in the social assistance database;
  • ensuring the complaint is relevant to eligibility;
  • reviewing the recipient's file and, where appropriate, arranging an interview with the recipient; and
  • determining if the case warrants further investigation.

When a case is referred to an ERO, a comprehensive investigation must be conducted which includes the verification of information by obtaining original or certified copies of relevant documents that assist in making a decision regarding eligibility.

An ERO investigation should be completed within 6-months after it has been determined that the case warrants an ERO investigation.

The names of all complainants (where provided) are to be kept confidential and maintained in the ERO file. Complainants should be notified that their names may be released should the matter proceed for prosecution.

After the investigation is complete, the ERO should prepare a written report for review by the ERO Supervisor. The report should:

  • make recommendations concerning ongoing eligibility;
  • identify any overpayment or arrears; and
  • recommend whether the matter should be referred to the police for investigation of fraud.

A copy of the report must be kept on file. The ERO should maintain all notes, documents and information from the investigation as part of an ERO file for future reference. After reviewing the report in conjunction with the file, the ERO Supervisor must be satisfied that sufficient information has been obtained to support a decision on eligibility.

If the investigation confirms that a recipient has received financial assistance that they were not entitled to, financial assistance should be reduced or cancelled as appropriate, and an overpayment established.

If the Administrator or designate determines there is sufficient evidence to suspect intent to commit fraud, the case must be referred to the police for investigation under the Criminal Code (Canada) and possible criminal prosecution.

Part or all of the case file may be released to the police on the authorization of the Administrator. A record is kept for all cases authorized for police investigation. A duplicate file must be created for police investigation while maintaining the working file at the local Ontario Works office.

Investigations are completed by the police with jurisdiction in the area where the alleged offence occurred.

Search Warrants

EROs are able to apply for and act under a Provincial Offences Act (POA) search warrant. Action under a search warrant may be necessary where it is clear and convincing that information that is missing or concealed is critical to determining eligibility. Under no circumstances is an ERO authorized to apply for and act under a Criminal Code search warrant.
Search warrants are generally used where requests for information from a third party relating to an investigation have been, or are likely to be, refused. EROs might be refused access because the third party holding the information does not recognize the authority of the ERO to collect it, or does not accept the validity of the consent form signed by the recipient. Examples where search warrants may be used to access information might include financial institutions, employers or other third parties.

EROs may not enter a place that is being used as a dwelling without the consent of the occupier unless it is under the authority of a search warrant. Search warrants are not to be applied for in order to enter dwellings unless there are reasonable grounds to believe that the dwelling is being used as a place of business or other employment and there is evidence related to this activity that has a bearing on eligibility.

A search warrant can only be obtained from a Judge or Justice of the Peace. Before granting a search warrant, the Judge or Justice of the Peace should be satisfied that there are reasonable and probable grounds to believe that an offence may have been committed and that evidence relevant to the offence can be found at the location to be searched. Certain conditions and limitations are involved when applying for and acting under a POA search warrant.

Search warrant powers must be authorized by the Director and are subject to certain criteria. EROs and/or their managers must successfully complete the provincial search warrant training course and appropriate local business protocols as outlined in the Search Warrant Manual.

Local Protocol

In order to process suspected social assistance fraud cases in an efficient manner, every Administrator should develop protocols and procedures with the local police services and the Crown Attorney's Office for the effective investigation and prosecution of cases of suspected social assistance fraud.

This protocol should outline the local practices of the social assistance delivery site, the police and the Crown Attorney for each stage of the investigation as it relates to the:

  • collection of information concerning the case;
  • process for referring a case to the police;
  • initial preparation and vetting of the ERO file with the police;
  • securing, documentation, storage and disposition of evidence; and/or
  • preparation of the Crown brief.

The protocol should also identify local contacts within the delivery site, the police agency and the local Crown's Office for the purpose of exchanging information and legal advice.

Responsibilities After Case Referred to Police

The ERO should monitor the referral and follow-up with the police concerning the outcome of the criminal investigation. If a charge is laid under the Criminal Code (Canada) or the Provincial Offences Act, the ERO will liaise with the investigating officer concerning such matters as court dates and disposition of the case.

At the conclusion of the court action, the Administrator or designate must ensure that the proper procedures are in place for the return of all original documents and cheques, and that the overpayment is dealt with appropriately and the results of the court action are promptly entered into SAMS  or First Nations file system where appropriate.

Where there has been a conviction for social assistance fraud, the ERO is responsible for obtaining a certified copy of the Certificate of Conviction from the court, placing it in the recipient's file and making the appropriate entries in the computer system.

Overpayments (see Directive 9.3: Recovery of Overpayments for more information)

In cases where there is a confirmed overpayment and the decision is not to refer the case to the police for criminal investigation, the applicant or recipient should be advised of the overpayment amount and reason. Recovery commences in accordance with procedures for the collection of overpayments in active and inactive cases.

In cases where there is a confirmed overpayment and the decision is to refer the case to the police for criminal investigation, the applicant or recipient is advised of the overpayment amount and reason. However, depending on the local protocol with the local authority, the overpayment may be deemed "temporarily uncollectable" pending the outcome of the criminal investigation.

Relocation of a Recipient under Investigation

If a recipient who is under investigation moves to a new location, and if information collected by an ERO is required at the new location to determine past and ongoing eligibility, copies of the file may be forwarded to the new location/delivery agent. The master file containing all original documents should be retained by the originating office.

Restitution Orders

In cases where there has been a conviction, the court may order restitution for part or all of the overpayments in question.

A restitution order differs from an overpayment, which is portable, in that the restitution order may specify that restitution is to a particular delivery agent. The delivery agent specified in the restitution order should monitor whether a recipient is making payments as per the terms of the restitution order.

If the recipient is not making payment, delivery agents may deduct a portion of the overpayment from the recipient's financial assistance.

Unfounded Allegations of Fraud

Allegations of fraud that are deemed to be unfounded or unsupported as a result of an assessment or investigation must be deleted/disposed from both electronic and paper files one year from the date that the assessment or investigation was completed (including documentation from police, crown and trial activities, where applicable). Any information pertaining to the eligibility complaint and results of the assessment or investigation should be destroyed.

This provision applies only to eligibility complaints that are unsupported and where no subsequent action on the case was taken (e.g., overpayment posted, case terminated, etc.) due to the complaint.

Other Instances of Fraud

If a third party (e.g., a vendor, child care provider, trustee, etc.) is suspected of fraud, a referral should be made to the appropriate authority that oversees the service contract and/or operations of the service provider.

Housing cases such as inappropriate receipt of rent-geared-to-income, or child care cases (e.g., operating a private home day care while claiming informal or formal childcare expenses) can be investigated by an ERO.