Embedded in Redbridge Council’s website are some of the highest numbers of third-party advertising trackers in the country, the Recorder can reveal.
The redbridge.gov.uk homepage plays host to at least 26 separate "cookies": text files that gather users' internet data for targeted advertising.
There are 26 pages to do with benefits, where the Recorder found visitors are hit with a range of tailored adverts.
These include package holidays, no-win-no-fee lawyers and NHS quit smoking campaigns. The more a user clicks on these pages, the more likely they are to see adverts for life insurance and low-cost funeral directors.
Redbridge is part of a network of 50 councils that host adverts specifically designed for council websites, for which it makes £27,500 a year.
A spokesman said: "We show advertising that we believe enhances residents' experience of the website.
"This helps raise revenue by making good use of an existing asset that has been paid for by taxpayers.
"These cookies belong to the marketing companies under contract to deliver our advertising, and the ad exchanges they work with."
Users are asked to accept or decline cookies when they first land on the website.
But a BBC investigation found more than 66 per cent of local authorities do not ask for the right form of consent under current privacy laws.
Eliot Bendinelli, a technologist at NGO Privacy International, said: "These tools allow companies to have a good idea of who you are, where you live, what you're interested in, what you're doing this weekend, or if you have any mental health issues.
"Tracking people through benefits pages is sadly typical. It's always the people that are already vulnerable who are going to suffer most."
Across the UK the BBC found a total of 950 third-party advertising cookies on benefits pages, on 54 per cent of council websites.
Google is phasing out these types of cookies in the next two years in response to calls for greater privacy controls.
Visiting Redbridge's website with a clean browser history on February 6, we were shown adverts for about a dozen different companies.
These included low-cost holidays with ClubMed and Tui, medical negligence lawyers, and products and services that might be useful to people in the trades such as Screwfix products, cleaning cloths and £295 one-day training courses.
There were also ads inviting users to find out their credit score or start up a home business on e-commerce platform Shopify.
But after about 30 clicks on pages to do with benefits, these ads gradually dwindled and were increasingly replaced with adverts for life insurance and funeral directors.
The council spokesperson added: "The government's Competition and Markets Authority is currently carrying out an investigation into funeral services and costs.
"One of its recommendations is that more should be done to promote price comparison for funeral services.
"It's a difficult time for families, but being prompted to think about options is helpful. The fact it was shown on a benefits page has no significance; it could have appeared anywhere on the website.
"We automatically block categories unsuitable for the public-sector environment including adult content, gambling, payday loans, politics and alcohol."
The council added that officers had "discussed the content" of the BBC's findings with its advertisers.
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