Between 1 percent and 4 percent of welfare recipients commit deliberate fraud, studies have consistently found. More people cheat on their income taxes and lie about their cross-border shopping than defraud the welfare system. As money for social services becomes scarcer, the provincial governments of Alberta, British Columbia, Ontario, Newfoundland and Quebec are stepping up efforts to catch welfare cheats. To fit the Criminal Code definition of welfare fraud, there must be a deliberate attempt to deceive the government. Overpayment is not necessarily fraud, so most overpayments, which are caused by welfare recipients or case workers misinterpreting complex and changing rules, are not prosecuted.
Municipalities generally deduct the amounts overpaid from future welfare cheques.
Actual fraud often involves collecting cheques from more than one municipality, failing to report earned income or failing to declare a common-law relationship. In a few cases, criminals have stolen cheques and cashed them using counterfeit identification. Such scams are becoming increasingly sophisticated. Some immigrants have arrived in Canada with false identification and instructions on how to collect welfare. Metropolitan Toronto Police Staff Inspector Steve Harris said.