CIFAS Releases Report on Internal Fraud Trends in the UK

CIFAS, a fraud prevention membership association in the UK, reported that internal fraud in the United Kingdom increased 14.5 percent in 2011. The CIFAS Staff Fraudscape report also identifies trends on employees more likely to commit fraud and the most effective ways to discover internal fraud.


Since 2006 CIFAS has maintained their Staff Fraud Database which tracks fraud committed by staff within their employer’s organization. In 2011 the confirmed cases of staff fraud grew 14.5 percent from the year prior. Also from 2010 to 2011 there was a 41 percent increase in dishonest actions to gain benefit by theft or deception by employees. Of these cases 31 percent involved employee theft from the customer and 23 percent involved theft from the employer.


While internal fraud has increased in the UK overall, there are some areas where organizations are improving. There has been a 25 percent decrease in incidences of unlawful obtainment or disclosure of personal data, showing that organizations are taking extra measures to protect customer and employee PII. But fraudulent applicants are not making it any easier for employers to weed them out as there was a 50 percent increase in applicants who attempted to hide a negative credit history from the employer while applying for a job where clean credit is crucial. Overall, however, fraudulent employment applications that were detected before employment began fell by 9 percent from 2010 to 2011.


The CIFAS Staff Fraudscape also reported useful statistics about who is more likely to commit different types of fraud and the more effective methods for detecting staff fraud. In 80 percent of the cases where a staff member was found guilty of disclosing personal data in 2011, the staff fraudster was under 30 years old. Also, of all the reported internal fraud cases where the staff member was female, 64 percent of these cases were classified as dishonest actions to gain benefit by theft or deception. Both of these trends are consistent with the 2010 report. CIFAS additionally found that in 2011 internal control and monitoring is how 44 percent of staff fraud cases were uncovered, whereas only 3 percent of staff fraud cases where uncovered by a whistle-blower.


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CIFAS Staff Fraud report reveals complex set of dangers

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