I doubt it is cost effective, but criminals should not be left to get away with it.
That said, perhaps if work paid, and more work was out there, people would be less inclined to commit fraud. There are people on the dole who languish there for years. They could have learned a trade in that time, or got a degree, or something else of use. It is no good urging people to get off the dole quickly, to improve their performance figures, to go into low paid temporary agency work they hate, which will either come to an end soon, or they will walk away from, and go back through the revolving door of the dole office. A working wage needs to be adequate to pay the bills, without resort to benefits.
The major fraud I see are "giro drops" - rented council houses which officially have a tenant, but not a soul shows up from one week to the next, using the address to claim a single person's benefit, whilst co-habiting with a partner. If we could tackle these, the housing crisis may turn out to be less severe than we think.