Government proposes measures to prevent benefit fraud and incorrect payments

The Government is proposing changes aimed at preventing intentional misuse of social security, reducing incorrect social security payments and improving information exchange with Kela, the Social Insurance Institution of Finland.

Misuse of social security, known as benefit fraud, refers to intentional or deliberate actions taken to gain financial benefit without entitlement. In benefit fraud cases, applicants seek to receive benefits either without any grounds or in amounts higher than they are entitled to. Such actions may include hiding bank accounts, falsifying bank statements or bills, or concealing the actual place of residence or stay in order to gain financial benefit. In 2025, the total value of benefit fraud cases that led to a request for investigation was around EUR 7 million.

“Using benefits without entitlement and submitting forged documents such as falsified bank statements are criminal offences and an abuse of taxpayers’ money. We are now taking action to address these abuses and giving Kela stronger powers to obtain information. We are also stepping up the fight against fraud and forgery more broadly and, in future, we will do so more effectively in relation to Kela benefits as well. Fairness also means that shared public funds are not misused,” says Minister of Social Security Sanni Grahn‑Laasonen.

Benefits may also be paid incorrectly for reasons other than fraud, such as misunderstanding on the part of the applicant, actions taken by public authorities or incomplete information. Reducing the number of incorrect payments is important because they cannot always be recovered. In 2025, around EUR 110 million in incorrect payments were recovered.

Easier interaction and stronger data protection

The proposal includes amendments to the Social Assistance Act, Act on General Housing Allowance, Act on the Housing Allowance for Pensioners, Act on the Bank and Payment Account Monitoring System, and Health Insurance Act.

The proposal would enable Kela to use the Bank and Payment Account Monitoring System to obtain information on a customer’s financial situation directly from financial institutions more often than at present. Customers would still be able to choose how account transaction data is provided. They could refuse to allow Kela to request transaction data from financial institutions and instead submit the information themselves, as they do now. However, choosing an electronic request as the delivery method would significantly simplify the customer’s interaction with Kela. It would remove all application steps related to submitting bank statements and shorten processing times.

Hiding bank accounts would no longer be possible. Under the proposed amendments, Kela would receive information on customers’ existing accounts and could then request the necessary transaction data either from the customer or through the Bank and Payment Account Monitoring System. Kela would also be able to rely on the integrity of data obtained through the monitoring system. For information submitted directly by customers, Kela would retain its current right to verify the data in cases of suspected falsification.

Kela already uses account transaction data when making benefit decisions, but at present customers usually provide the required bank statements themselves. Transaction data is also currently shared by email between Kela and banks, so a direct connection to the monitoring system would improve information security.

In cases involving suspected fraud related to basic social assistance, the proposal would give case officers the right to request information on eligible expenses directly from the billing party. This amendment would address cases where customers falsify bills to claim more support.

Repeated abuse of Kela‑funded taxi services would be addressed by giving Kela the right to disclose customers’ personal data to the dispatch centre that arranges ride sharing. This would apply to insured persons whose travel costs are no longer reimbursed directly to the service provider due to repeated abuse of the service. In these cases, the customer would pay for the taxi ride themselves and apply for reimbursement from Kela afterwards. Misuse of Kela taxi services refers to using Kela‑reimbursed taxis for purposes other than healthcare‑related travel.

Kela regularly identifies cases where a family member applying for benefits has a poste restante address recorded in the Population Information System for long periods, even though the family members actually live at the same address. The aim of this practice is to ensure that a spouse’s earned income does not affect the family’s benefits. In some cases, a social assistance claimant may in fact live abroad and is therefore not entitled to benefits paid from Finland. For these reasons, the proposal would clarify applicants’ obligation to provide Kela with accurate and up‑to‑date information on their place of residence and stay.

The proposal would also clarify Kela’s rights to access information so that it could make better use of the Kanta query and forwarding service to receive the medical evidence and certificates attached to benefit applications. This objective is not related to misuse but aims to improve the efficiency of Kela’s operations and reduce administrative costs.

Proposed amendments form part of the Government Programme

The proposed measures are based on the Programme of Prime Minister Orpo’s Government, which calls for preventing misuse by improving the exchange of information on support granted by Kela.

Improving Kela’s access to information aims to prevent fraud and forgery offenses related to benefits. The amendments would also make it easier for applicants to interact with Kela and speed up benefit processing. Better information exchange would improve information security by eliminating the need to send personal data by email. The reform is expected to generate annual savings of EUR 9.5 million for public finances.

The amendments related to banking and account details and to medical evidence and certificates will enter into force on 1 March 2027. The other amendments should enter into force on 1 September 2026.

• Link to the proposal (in Finnish)
• Frequently asked questions about banking and account details (in Finnish)
• Assessment memorandum of the working group for preventing social security abuse and promoting information exchange with the Social Insurance Institution of Finland (Institutional Repository for the Government (Valto)). Abstract in English.

Inquiries:

Emmi Venäläinen, Special Adviser to Minister of Social Security Sanni Grahn-Laasonen, tel. +358 295 163 058
Essi Rentola, Director, tel. +358 295 163 155
Email addresses are in the format [email protected]