Is it permissible to boycott colleagues who send fake lease contracts to benefit from housing allowance, and not to eat their food?

A Muslim is obligated to fulfill the agreed-upon conditions, as the Prophet, peace and blessings be upon him, said: "Muslims are bound by their conditions."

Therefore, if the employer stipulates that housing allowance will not be disbursed to those who own private accommodation, then this must be adhered to.

Your colleague's action is impermissible, and he needs advice and admonition.

Boycott anyone who does such a thing if boycotting will deter him. Otherwise, do not boycott him, but rather admonish him, so that you do not become an aid to Satan against him.