New Business Fraud Alliance launched

If you’re a regular reader of this blog, you’ll know that business fraud is a growing problem. Invoice fraud – where criminals deceive businesses into paying fake or altered invoices is on the rise. Payroll fraud costs companies an average of £40,000 per incident. Then there are the perennial cases of criminals posing as HMRC, trying to trick you out of your money. For all these reasons and more, a new Business Fraud Alliance campaign has been launched.

What is the Business Fraud Alliance?

The Business Fraud Alliance is a joint initiative between the Fraud Advisory Panel (FAP) and Barclays.

It describes itself as “a collaborative, nationwide effort created to raise awareness of fraud threats and equip UK businesses with the tools and confidence to protect themselves.”

How can the new campaign help me?

The new Business Fraud Alliance campaign is particularly helpful as an online resource to help businesses understand and counter fraud.

It identifies six main categories of fraud that businesses should be aware of. These are:

• APP fraud. When people are tricked to send money to fraudsters using authorised push payments (APPs), such as bank transfers.
• Cybercrime. This covers a wide range of online crime, including phishing, ransomware and DDoS (distributed denial of service) attacks.
• Staff fraud. This can take many forms, from forging expense documents to making unauthorised withdrawals from company accounts.
• Financial statement fraud. This concerns altering financial statements to conceal a business’s true position or performance.
• Procurement fraud. This can happen at any stage of the procurement process. Types of fraud can include bribery, kickbacks, invoice fraud and bid suppression.
• Payment fraud. This is when criminals use stolen or cloned card details to make ‘card-not-present’ transactions online or over the phone.

Resources to help you

In addition to identifying the above types of fraud, the Business Fraud Alliance also offers a library of helpful downloads. Key titles include:

• Procurement Fraud Overview – A checklist
• Business Authorised Push Payment Fraud Helpsheet
• Failure to Prevent Fraud Offence – A checklist
• Preventing Cybercrime. How to keep fraud and cybercrime out of your business
• Managing fraud risks. How to keep fraud out of your business

There’s also a very useful helpsheet from the National Crime Agency and the National Economic Crime Centre – Invoice Fraud Prevention Advice.

Finally, the campaign website has a ‘Trends & Insights’ section, where you can find useful tips and information.

Reporting business fraud

The new campaign also directs businesses to relevant agencies for reporting fraud. These include Action Fraud, the National Cyber Security Centre and CrimeStoppers.

Is your business taking steps against fraud?

If your business becomes the victim of fraud, it can be hugely damaging to your financies and reputation. To prevent this happening, you need to make fraud prevention a major priority. Steps you can take might include:

• Strengthening internal controls. Avoid letting individuals having end-to-end control of finances, introduce robust approval processes and make regular financial reconciliations.
• Check customers and suppliers are genuine. Run due diligence checks, phone trusted contacts before transferring funds, and watch out for impersonation fraud.
• Train and educate staff. Make sure relevant staff have fraud awareness training and know how to report concerns.
• Introduce cybersecurity measures. It’s good practice to get certified with Cyber Essentials Plus to help defend yourself against cyber threats.
• Have strong financial safeguards. Limit cash handling, use corporate credit cards (which have stronger fraud protections than bank transfers), and make sure you have relevant insurance.

Overall, it’s important to have a culture of vigilance. Promote a ‘trust but verify’ approach to staff and remind them business fraud comes from inside as well as outside.

Any questions?

If you are a THP client, rest assured that we have robust controls to protect your financial data. We also have controls in place to minimise any risk of fraud. However, if you have any questions, please do ask your account manager. They’ll be delighted to help you.