Checks are being made on information submitted by Cheltenham Borough Council to ensure housing benefit claims and parking permits are not fraudulent.
The electronic data is matched by the Audit Commission against databases held by other public services.
In England councils are legally required by the Audit Commission to carry out this work under their National Fraud Initiative.
From 2009 the checks will also cover council tax discounts.
Mark Sheldon, chief finance officer at Cheltenham Borough Council, said: "Our own anti-fraud and anti-corruption policy already empowers us to proactively prevent and detect fraud.
"NFI allows us to tap into the technical expertise and resources of the Audit Commission and widen the scope of our fraud detection work."
Councillor Steve Jordan, leader of the council said: "This an important and worthwhile long term initiative and helps in detecting fraud. In taking part we are complying with the latest guidelines to ensure that people's data is properly protected."
Any data matches reported back to council officers will be investigated next February and the outcome of the exercise will be reported to the council's Audit Committee at the end of March 2009.