CIFAS, the UK’s Fraud Prevention Service, and the Chartered Institute of Personnel and Development have launched free guidance to help employers understand the threats associated with fraud and help HR professionals manage the risks.Staff fraud is increasing. Examples of “insider fraud” make headlines almost daily. This can damage an organisation’s reputation and staff morale as well as causing a loss of money. The guide urges employers to be on their guard when vetting prospective employees and to ensure that the environment for existing employees is one in which fraud cannot prosper.
The guide makes it clear that the majority of staff within any organisation are trustworthy and honest, but there is now a greater understanding of the scale and threat posed by a small proportion of the staff who act dishonestly and defraud their employer.
CIFAS research indicates that staff fraud has been a growing problem in recent years. Some organisations have seen a 30% increase in the number of staff fraud referrals made to the relevant fraud department in the past year. The value of employee fraud has risen almost 80% in 2005 from a year earlier, and more than 200% since 2003 according to a FraudTrack report from BDO Stoy Hayward.
There has been a massive rise in identity theft in recent years. The number of victims of impersonation recorded by CIFAS has grown from 16,810 cases in 1998 to 67,406 cases during 2006. It is likely that organised criminals have contributed to this increase.
In a survey by Leicester University, 70% of the 2,000 people questioned admitted they would commit fraud, if they knew they would get away with it.
The Guide is available at: http://www.cipd.co.uk/guides