Landlords making bogus housing benefit claims were costing each Portsmouth taxpayer about £100 a year, The News revealed.
And the problem grew to such an extent that the city council employed a team of nine special fraud busters.
Head of housing Jeff Wellings said the authority was in the process of sifting through more than £750,000 of claims, many of which were fraudulent.
He estimated that between 15 and 20 per cent of Portsmouth’s claims were in fact bogus, costing 50,000 to 60,000 city taxpayers £100 a head – equivalent to a total of £5m a year.
Mr Wellings said before the current fraud checks the biggest scam was landlords failing to tell the council when tenants moved.
This meant housing benefit cheques continued to be sent to landlords to pay tenants’ rent long after they had gone.
Mr Wellings said: ‘We now carry out random swoops on any property where more than two people live and because of the register the city now keeps of houses in multiple occupation we check on those too.’