Tax inspectors have already recovered almost £800,000 in furlough money across Norfolk and Suffolk since the outbreak of the pandemic – but have not prosecuted anyone for fraud.

In response to a Freedom of Information Request by this newspaper, HMRC revealed it has so far settled 182 compliance cases with regards to the Coronavirus Job Retention Scheme (CJRS) across the two counties, recovering £787,312 in yield from those who committed fraud and who overclaimed in "honest error".

HMRC has been overwhelmed by tip-offs, receiving 36,403 reports of CJRS fraud nationally since March 2020.

In Norfolk and Suffolk, HMRC said it was still investigating a further 436 cases and will take "as long as necessary" to complete them.

But the government department stressed it plans to use prosecution "proportionally" – and hopes the majority of cases will be resolved without needing to go to court. Only five people so far have been arrested in regards to misuse of the CJRS.

"We will pursue a civil route with claimants who have made genuine mistakes, as long as they work with us to put it right", its spokesman said. "But we will not hesitate to take criminal action against the most serious cases."

Between March 2020 and October 2021, the CJRS cost the taxpayer £69bn.

It has been credited with halting a wave of pandemic-induced mass unemployment by covering up to 80% of a employees' wages, and protecting businesses forced to close their doors for months at a time.

But while HMRC claims it "designed anti-fraud measures into the Covid support schemes from the beginning", the sheer quantity of reports suggests suspected misappropriation of funds was rife.

One individual to report their employer to HMRC was Matt Lane, a 43-year-old living in Great Yarmouth.

The engineer claims he worked all over the East of England during the first lockdown while he was on furlough from his engineering job – eventually leaving the company because he felt it was "immoral" to "bite the hand that feeds you".

In a text seen by this newspaper, his employer said to staff last year: "With regards to the furlough system, I looked this morning and it's still not operational. But if I still think that people are not going to support the company and the needs of places we serve then I'm not going to waste my time and will lock the doors."

When we challenged the employer, he denied anyone worked for him while they were on full furlough, but admitted asking them to.

He said: "At the beginning I was confused about what the system meant and when it became operational, but that was quickly clarified.

"At the end of the day, even if they were asked, none of our former employees can prove they were ever actually made to physically work while on full furlough."

Mr Lane said he had still heard nothing back from HMRC about his fraud report, in which he claims he shared ample evidence he was carrying out jobs for his employer while receiving 80% of his wages from the taxman.

"I don't think they should be too soft on people who wrongly claimed furlough money, because a lot of people faking ignorance will have known exactly what they were doing", he said.

"I'm of the belief that karma will get anyone who cheated taxpayers if HMRC doesn't."

Eastern Daily Press: Is a September deadline for the furlough scheme just putting off the inevitable? Photo: Rui Vieira/PA WireIs a September deadline for the furlough scheme just putting off the inevitable? Photo: Rui Vieira/PA Wire (Image: Archant)

Last March, Rishi Sunak said he was investing £100m into a 1,250-strong taskforce to recover incorrect claims.

A HMRC spokesman said: "We currently have a number of criminal investigations ongoing, have opened 26,000 civil inquiries and have already made five arrests for suspected CJRS fraud."

As of June 2021 HMRC had received £568.7m in voluntary repayments – where a business did not need all the money they were given – and £337.8m in unprompted disclosures, where a business contacts HMRC to pay back knowingly overclaimed money.

He added that during 2020-21 HMRC stopped or recovered £840m of overclaimed grants, and is expected to recover a further £800m - £1bn by 2023.