Businesses in the UK lose £273,972 every minute to fraud. Businesses can take these 5 steps to defend themselves.
UK Businesses lose £144 billion per year to fraud. The research carried out by Solution Loans shows that whilst collectively private citizens are victims of fraud, the value of frauds are lower, totaling £10 billion pounds per year which, whilst still extremely serious, is a fraction of the money lost by private sector organisations.
Whilst fraud-based crime has a long history in the UK, it has boomed since the rise of the internet and as more and more businesses have operated online. Online fraud is now the most common crime in the UK and whilst the value of a particular case of fraud may be low, there are so many instances that the collective impact is huge. It is estimated that currently, online fraud accounts for 16% of all crimes.
A National Audit Office (NAO) report has stated that “Fraud is now the most commonly experienced crime in England and Wales, is growing rapidly and demands an urgent response. Yet fraud is not a strategic priority for local police forces and the response from industry is uneven.”
So, what can businesses do to protect themselves from fraud? Here are our top tips:
1. Regularly review cybersecurity systems and procedures.
This will help prevent the loss of details about things such as company credit card numbers.
2. Have a register of who has a company credit card and regularly audit these.
Keep a spreadsheet of all purchases made with a card and regularly audit these against receipts.
If one employee loans a company credit card to another employee to enable them to purchase goods or services for the business, ensure these transactions are clearly demarcated in your tracking.
3. Review fraud policies on a regular basis.
Diarise regular reviews of fraud policy and procedure and ensure that any changes in these are communicated to all staff.
4. Screen employees carefully before hiring.
Thoroughly check references and CVs as well as educational credentials, being sure to clarify anything unusual or any discrepancies.
5. Ensure checks are in place.
Rotate financial duties between staff so that any unusual activity is detected. Follow up on any unusual payments to private individuals or suppliers you don’t know, whether online or offline.
If a single member of staff does manage finances or payments, ensure their contract has a mandatory holiday of a least one week’s worth of consecutive days per year as this will help others spot fraudulent activity or discourage fraud in the first place.
