Two people have been arrested over a suspected £70,000 Coronavirus Job Retention Scheme fraud, HM Revenue and Customs (HMRC) has said.
Earlier this week, the Government threatened to take criminal action against anyone who has made a fraudulent or dishonest claim under its furlough scheme.
Downing Street has pledged to do “everything possible” to claw back taxpayers’ money which has been wrongly handed out, Boris Johnson’s official spokesman said.
HMRC is currently looking into 27,000 “high-risk” claims, with a number of criminal investigations into suspected fraud now under way, he told a Westminster briefing on Tuesday.
It follows the disclosure that up to £3.5 billion may have been erroneously paid out under the national job retention scheme.
Jim Harra, chief executive of HMRC, said his staff believe between five and 10 per cent of furlough cash might have been sent to ineligible claimants.
The Government has so far paid out £35.4 billion in furlough cash, according to the latest figures.
On Monday, the permanent secretary told MPs on the Public Accounts Committee that wrongful claims ranged from “deliberate fraud through to error”.
It was the first time HMRC has spoken publicly about the level of potential fraud that could have been committed as part of the job retention scheme, which has covered up to 80 per cent of an employee’s salary while they were on furlough.
The Prime Minister’s spokesman said: “Where genuine mistakes have happened HMRC will work with employers to correct claims but if any claim is suspected of fraud or is based on dishonest and inaccurate information payments may be withheld or need to be repaid.
“HMRC won’t hesitate to take criminal action in the most serious cases.”
The first arrest for suspected fraud was made in July.
HMRC said it arrested a man from Solihull, West Midlands, amid allegations of a £495,000 fraud involving the furlough scheme.