Charity Finance Group and PKF Littlejohn have launched a new guide to help charities proactively counter fraud.
The guide follows the release of figures which were announced in May’s Annual Fraud Indicator (AFI), which show that the cost of fraud to the charity sector has increased by 73 per cent from £1.1bn in 2013 to £1.9bn.
Countering Fraud: A guide for the UK charity sector has been produced to help stop the financial, and reputational, damage that fraud can cost to a charity.
Heather McLoughlin, policy and public affairs officer at the CFG, said: “With increased public focus on charities and scrutiny in the media, it is really important that we get to grips with fraud. The financial and reputational impact of fraud can be significant, and it’s a problem that can affect any charity, from very small to very large.
“This guide will help finance professionals and trustees identify areas for improvement when building their resilience to fraud, and moving towards actively managing the risk of fraud.
“At a time when charities have to make their resources go further, we need to recognise the impact of fraud on our beneficiaries. Every pound saved from preventing and detecting fraud is another pound that can go on delivering our charitable purposes.”
Jim Gee, partner at PKF Littlejohn and one of the authors of the guide, said: “Fraud has a pernicious social and economic impact on the UK. In the charity sector, charities are deprived of the full value of the donations which we make, are less able to fulfil their charitable purposes and are more vulnerable to reputational damage.
“Fraud is best seen as similar to a clinical virus – something which continually mutates and changes as fraudsters seek the greatest benefits for the least risks. The best way to reduce its extent and cost is to make sure charities are fraud resilient and able to protect themselves against a continually evolving threat. This guide will help them to do that.”