Undetected fraud a growing burden on business

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Responding to the news that almost 4 million instances of fraud are being omitted from crime statistics, the ALMR has warned that failure to address card and insurance fraud is imposing costs on businesses.

Analysis by the Office for National Statistics has shown that incidents of bank and credit card fraud are being left off the Crime Survey for England and Wales and that including them would increase the estimated annual number of offences by 50%.

ALMR Strategic Affairs Director Kate Nicholls said: “Fraud imposes myriad costs on businesses, whether through artificially high insurance premiums as a result of dishonest claims, unnecessary police scrutiny following dishonest theft reports or the ‘double whammy’ of lost stock and revenue following card fraud by what the business thought were legitimate customers.”

Though estimating the scale and value of undetected fraud is fraught with difficulty, the Association of British Insurers detected £1.3bn of fraudulent claims in 2013 and estimates that a further £2.1bn goes undetected. Nicholls continued:

“Despite a huge amount of investment and training to reduce accidents and injuries in our sector, insurance claims keep growing. Systems to detect insurance and card fraud are improving but are still far from perfect and it must be recognised that every fraudulent card transaction is a crime against not just the card holder but the business being defrauded of its product.”

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