Major social housing agency probed over £300m fraud and bribery allegations

Six people have been arrested this morning after the Serious Fraud Office (SFO) launched a massive investigation into a social housing company.

Home REIT – which owned thousands of homes intended for homeless and vulnerable people – is being probed over suspected fraud and bribery offences worth an estimated £300million.

The firm told investors their cash would be used to buy and restore properties to house rough sleepers, veterans and people struggling with addiction.

But claims later arose over the condition and value of properties as well as allegations that the housing was being privately rented via Zoopla or as holiday accommodation via Booking.com.

Solicitor General Ellie Reeves threw her weight behind the SFO’s investigation saying it was an important case as both investors and vulnerable people appear to have been “let down”.

On Wednesday morning, SFO investigators – along with the National Crime Agency – carried out seven searches and made arrests at homes in Altrincham, Maidenhead and across London. A commercial site in Manchester has also been searched. A home address in Venice is also being searched with Italy’s Guardia di Finanza.

Five men and one woman, in their 40s, 50s and 70s, were arrested and will now be questioned.

SFO investigations, which can involve millions of documents, often take years to conclude. Investigators vowed to progress the case – which is one of the largest arrest and search operations in the SFO’s history – as quickly as possible.

In its first three years of trading, from 2020, Home REIT raised £850million by selling investment in its leasing of homes across the UK. Investors were told their money would be used to buy and restore properties that would be block-let to publicly funded charities and Community Interest Companies to house vulnerable people. Returns would be generated to investors from rent payments.

But in 2022 an investor report raised concerns about the valuation of its properties and the ability of its tenants to pay rent. A legal claim was brought against the company by investors in the same year. The company suspended trading on the London Stock Exchange in January 2023.

Law firm Harcus Parker, representing the investors, detailed on its website: “Home REIT informed investors that it would invest in ‘high-quality homeless accommodation’ and that its investment strategy will seek to ‘exclusively tackle homelessness’.

“We have seen evidence to indicate that properties owned by Home REIT are being used in the private rented sector, have been found by local authorities to be unsuitable for housing vulnerable individuals and have consequently been denied ‘exempt accommodation’ status under the relevant housing benefit rules, and that others are being advertised by agents and on websites such as Zoopla and Spare Room for students and professionals and even on booking.com as holiday lets.

“The evidence we have seen suggests that the properties are being advertised for individuals who are not vulnerable and in need of care, support and supervision, and who consequently would not qualify for exempt accommodation under the housing benefit rules.”

In 2024, the Financial Conduct Authority opened an investigation into Home REIT.

Ms Reeves told The Mirror: “This was a scheme that was supposed to help some of the most vulnerable in society, homeless people, veterans, those suffering from addiction, and people were encouraged to invest in this scheme to support some of those most vulnerable people in society, and that’s why I think it’s doubly important that the SFO carries out this investigation and looks into what’s happened here.

“It’s really important where it does look like there’s been bribery, or it does look like there’s been wrongdoing, that the Serious Fraud Office steps in and says: ‘This isn’t okay. We need to take action here.

“It’s not just the investors that have been let down. It’s also the vulnerable people that were relying on and expecting to get housing as a result.”

Emma Luxton, Director of Operations at the SFO, said: “This company had a meteoric rise, spending millions on properties that were supposed to house the most vulnerable in society and provide returns for investors.

“Its chaotic downfall has left many with unanswered questions. Today we conducted a major operation to advance our inquiries into suspected bribery and fraud.”