Fraud is now the UK’s most common criminal offence and costs the UK as much as £190 billion a year, or around £7,200 per household, a new study has found.
The Annual Fraud Indicator 2017, which was compiled by Crowe Clark Whitehill, Experian and the Centre for Counter Fraud Studies, revealed that private sector fraud costs the UK economy £140 billion, while fraud in the public sector is estimated to cost the country £40.3 billion in 2017. In addition, fraudulent activity aimed at individuals amounts to £6.8 billion, while charities lose around £2.3 billion.
The private sector is the worst hit, says Experian, largely due to the volume of expenditure conducted by private enterprises. Public sector fraud, on the other hand, is the easiest to measure and detect due to the reliability of tax and benefits data.
A significant proportion of the costs of fraud in the report are attributed to procurement fraud. Procurement accounts for a large portion of organisational expenditure and fraud can creep in at various stages of the procurement process. The report found that the rise in the incidence of fraud in registered charities is largely attributable to an increased expenditure on procurement.
According to the report, new trends have emerged that impact demography and type of fraud victim. Technology continues to open up new avenues for fraudulent activity, which is clearly demonstrated by the sharp increase in Online Banking fraud and Telephone Banking Fraud, which have apparently grown by 226% and 178% respectively over the past twelve months.
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