She said there had been “a number of cases” recently of terrorists making fraudulent student loan claims to fund their activities.
MPs described the prospect of British money being used to bankroll potential terrorist plots on British soil as “sickening”. Keith Vaz, chairman of the Commons home affairs committee, said he would in the coming weeks question Theresa May, the Home Secretary, over the “shocking” disclosures.
Two brothers became the first Britons to be jailed for Syria-related terrorism offences, having gone to a training camp in the country.
Another jihadist, who skipped bail to fight in Syria, used Twitter to mock the lapse in security that allowed him to flee.
Meanwhile, the family of Fusilier Lee Rigby claimed that Facebook failed in its “duty of care” when it missed messages in which one of his murderers discussed killing a soldier. Facebook was accused in a report of being a “safe haven for terrorism” after it failed to pass on information that could have prevented the killing of Fusilier Rigby in Woolwich, south-east London, last year.
Miss Nicholson, a Met Assistant Commander, said terrorists were using “innovative” techniques to send money abroad. “We are seeing a diverse fraud, including substantial fraud online, abuse of the benefits system, abuse of student loans, in order to fund terrorism,” she said.
She also said women were being used to smuggle money out of Britain to fund terrorists abroad, as it is believed they will arouse less suspicion. Earlier this month, Amal El Wahabi, a British mother-of-two, was jailed for more than two years for trying to arrange to smuggle €20,000 (£16,000) to her husband, who is believed to be a jihadist fighting in Syria. She duped her friend, Nawal Msaad, into carrying the cash in her underwear.
Philip Davies, the Tory MP, said of Miss Nicholson’s claims: “I know the Government has been cracking down on benefit fraud. It seems to me that this shows that if anything, they need to go further.”
He added: “It is sickening to think that [UK money is funding terror plots] but whenever there is any money being doled out, it’s obvious that terrorists will be trying to get their hands on as much of it as possible.”
Kwasi Kwarteng, a Conservative member of the Commons work and pensions committee, said: “Ordinary people will be very, very concerned about this and it’s something which the Government obviously has a duty to crack down on.”
Mr Vaz said: “It is shocking that this is happening. We need to see assurances from government that the integrity of the student loan and benefits
system has not been compromised, with the full cooperation of the banking network.”
A spokesman for the Department for Work and Pensions said: “No one should doubt our commitment to rooting out benefit fraud.”
Ministers said up to 50 suspected jihadists a year are expected to be prevented from going to Syria or other terrorism hot spots under proposed powers to seize passports.
Around 15 terror suspects a year will also be placed under the revamped terrorism prevention and investigation measures (Tpims), which restrict their activities.
The measures are part of the Counter-Terrorism and Security Bill.