Members of the public will be given hundreds of pounds for helping catch illegal sub-letters in a new crackdown on tenancy fraud.

Housing Minister John Healey has promised £500 to people whose tip-offs helped take back the first 1,000 homes, which would then be released to those in real need.

Brighton and Hove City Council will receive £30,000 from the fund and Lewes District Council will be given £10,000.

The cash will also be used to set up council-run anti-fraud initiatives - including special hotlines and crack squads to investigate allegations of fraud.

It is estimated by the Audit Commission that between 120 and 600 council homes in Brighton and Hove and around 30 homes in Lewes are being rented out illegally to other families.

Council bosses claim pubilc tip-offs are vital to tackling fraudsters, with around half of all recovered homes coming as a result of tip-offs from neighbours.

Councils and housing associations also received around 8,000 leads to potential tenancy cheats in their communities which were found through “data swaps” by the Audit Commission matching tenancy records against records held by councils, housing associations and other public bodies.

They are also being given practical advice on how best to tackle housing fraud.

The Argus revealed this year how tenancy cheat Georgia Parsons pocketed tens of thousands after unlawfully sub-letting her property.

Parsons earned more than £17,000 in housing benefit and council tax benefit over a two-year period from 2006.

She was handed a suspended prison sentence in April after she received around £600 a month from her council house while she lived in Spain.

Mr Healey said: “We can’t allow cheats to hang onto the tenancies of council houses they don’t need to and don’t live in. I want people to feel the system for housing families who need homes is fairer and that’s why I’m launching this national crackdown on tenancy fraud.”