i'm sure you need ILR to claim disability allowance and not be subject to immigration control.
http://ukba.homeoffice.gov.uk/ukresi...s/publicfunds/
there are exceptions for some benefits thou, so it might be worth checking so CAB could be right, i doubt it, but then many who work at CAB are not immigration experts
a call to the local law centre might help, but i think they should not be claiming it, and they could get their application for ILR refused, maybe they could pay it back..
and not mentioning it on their ILR app, is fraud - i would have thought it could be easily checked N/I number?, and may well get them a long ban from coming back to the uk.