Charities need to be vigilant in order to reduce their risk of becoming a victim of fraud, especially as the pandemic has exacerbated some issues, an expert has warned.
Mia Campbell, head of the Fraud Advisory Panel, which is a charity dedicated to fraud prevention, delivered the closing keynote at yesterday’s Charity Finance Summit, organised by Civil Society Media. She advised delegates to make sure staff and volunteers understood what to look out for and how to report potential fraud.
“It's really important to mention here, charities do fall victim to fraud and I'm sure many of you have already seen some fraud come across your books,” she said. “If you haven't then I suggest maybe you haven't looked hard enough.”
She said it was incorrect to think that the charities were “immune” to fraud, and that in fact some fraudsters see the sector as “a bit of a soft touch”.
Increasing levels of fraud
Campbell told the audience fraud was widespread in society.
“In the UK, you are more likely to become a victim of fraud than you are to become a victim of almost any other kind of crime,” she explained.
In addition, unlike other crimes, fraud has increased during the pandemic by about 40%.
“That’s because fraudsters were seeking ways to take advantage of the current situation for their own gain,” she said.
In terms of how likely charities are to be affected by fraud, she said 2019 research with the Charity Commission found that up to one in three charities would become victims of fraud.
“I think that's probably a quite a significant underestimate now,” Campbell said.
She highlighted that most fraud is classified as “insider” fraud, where the fraudster is known to the charity.
Campbell added: “There's also a bit of a concern that some fraud may have actually been hidden during the pandemic because of the way we've been working, and that they might start to come to light over the coming months, or even the coming years.”
Charity Fraud Awareness Week
Charity Fraud Awareness Week takes place later this month (18-22 October) and Campbell said that the new resources were being made available as part of this.
The Fraud Advisory Panel has launched a new website, preventcharityfraud.org.uk, and is organising webinars and blogs as part of this year’s focus on fraud.
Campbell concluded: “I really want to encourage you to get involved in the week. Think about fraud, and how it might impact on your charity. Starting a conversation about fraud shouldn't be difficult. I appreciate it can be challenging, but it's really important to do.”
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