New research from Action Fraud shows that UK businesses reported a combined loss of £682m in the past year because of fraud.
The data shows that businesses submitted 59,192 reports about fraud in 2018-19, with an average loss of around £11,500 in each case.
The highest losses resulted from corporate employee fraud (accounting for £214m in losses), followed by mandate fraud (£100m losses). Mandate fraud occurs when an employee is tricked into redirecting a regular payment mandate to a fraudster’s account.
Fraud involving cheque, plastic card and online bank accounts was not far behind, accounting for £98m, while hacking via social media or email resulted in £11m of losses. Fraud by abuse of position of trust led to £10m of fraud, while false accounting fraud was close to £4m.
Tim Merritt, fraud and forensics partner at RSM, said: “The amounts being lost by business 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.
“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.”