Tania Mason: Fraud - see it, say it, sort it

13 Nov 2017 Voices

Tania Mason says that charities need to be ready to respond to the risk of fraud.

Governance & Leadership magazine is proud to be the media partner for the first Charities Against Fraud Awards, hosted by accountancy firm Moore Stephens and supported by the Charity Commission and Fraud Advisory Panel. The words ‘fraud’ and ‘charity’ are not easy bedfellows; it is tempting for any charity to bury their heads in the sand, pretend that fraud is not a problem for them and hope it goes away. But as the Commission’s Alan Bryce, head of development and operational intelligence, points out in our news analysis, the charities that claim to have no problem with fraud are likely to be at the highest risk of falling victim to it. After all, committing cyber-based crime is low cost, low risk and reasonably easy and no matter how good your defences, a determined fraudster will find a way through.

And charities are at no less risk than any other type of organisation, as new figures from City of London Police demonstrate. In the last six months alone there have been 823 cases of employee fraud at UK charities, including one trustee who stole £1.2m, as well as 298 victim donation cases – instances where donors have given money in good faith to fundraisers only for it not to reach the charity.

In this context, congratulations to Macmillan Cancer Support, winner of the Large Charity category at the Charities Against Fraud Awards. They had the foresight two years ago to hire a dedicated counter-fraud manager, who instigated a civil recovery process which has so far successfully recouped nearly £169,000 for Macmillan from such fraudsters.

It is important, says Alan Bryce, to report all cases of fraud that you find or suspect, examine how they occurred and plug those gaps. While charities are not currently required by law to report frauds to the Commission or police, they are strongly encouraged to do so by the serious incident reporting regime. As Bryce says: “If five charities in the same area are hit by the same type of fraud in a short space of time, if we know about it straight away we can warn other charities in the area. But if we don’t know, we can’t.” So while there may not be a legal duty to report fraud cases within your organisation, there is a moral duty. Take a cue from British Transport Police: See it, say it, sort it.

More diversity, please

It’s now nearly a year since this magazine featured board diversity as its cover theme, espousing the benefits that diversity of gender, ethnicity, age, experience, background and skills can bring to a trustee board. A few days ago, out of interest, I put ‘charity trustee’ into the LinkedIn search bar, and had to scroll for ages before I came across a single person who wasn’t white. This is not a good state of affairs, and something the sector needs to address.

At our 11th annual Trustee Exchange conference next April, we have convened a panel to explore what charities can learn from other sectors about improving diversity, with representatives from business, the Civil Service and the NHS sharing their expertise and experiences. The full programme and booking details can be found here. We very much hope you will join us.

Tania Mason is editor of Governance & Leadership magazine

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