Businesses reported £682m of fraud last year

Businesses are being urged to do more to protect themselves from fraud as new figures show that business losses reported to Action Fraud reached £682m last year.

The data, obtained by RSM from Action Fraud, the UK’s national fraud and cyber-crime reporting centre, has been released to coincide with International Fraud Awareness Week.

It revealed that businesses submitted 59,192 reports about fraud in 2018-19, with an average loss of around £11,500 per case.

The highest losses resulted from corporate employee fraud (accounting for £214m in losses), followed by mandate fraud (accounting for almost £100m in losses). Mandate fraud occurs when an employee is tricked into redirecting a regular payment mandate to a fraudster’s account.

Tim Merritt, fraud and forensics partner at audit, tax and consulting firm RSM, said: “The amounts being lost by businesses to fraud are eye-watering, but the figures probably underestimate total losses as unidentified frauds cannot necessarily be quantified.

“While some larger businesses are able to absorb the impact of fraud, for smaller and mid-sized firms, the effects can be more severe, even putting the future viability of the business at risk.”

He added: “Preventing fraud need not be arduous or expensive. A robust anti-fraud and bribery policy supported by the right training, business processes and controls can be very effective.”