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The national and industry body picture and strategy to tackling fraud

05-06-2023|Anthony Gougeon

UK Finance is the trade body for the banking and finance industry representing more than three-hundred-member firms across the industry – including Ultimate Finance.  It works with the industry as well as public bodies such as the UK government on a range of issues not least of which includes preventing economic crime which is one of its key priorities – including fraud.  It recently published its annual fraud report detailing the amount of money, over £1.2 billion, reported by members stolen in fraud in 2022.  It draws attention to the UK governments new fraud strategy with the aim of stopping fraud at its source and the need of other sectors; including the finance sector, to do far more to tackle the problem.

According to the UK governments recent Economic Crime Plan and subsequent fraud strategy for prevention, fraud in 2022 accounted for an estimated 3.7 million incidents of fraud and represented 41% of all crime experienced by adults in England and Wales. It was by far the most common crime with 1 in 15 adults’ victims to fraud with nearly 20% of those being repeat victims.  Likewise, in 2020, around one in five businesses had been a victim to fraud in the previous three years.  Nevertheless, despite that, fraud receives less than 1% of police resource.  Some of the government’s key findings and strategy (which are reflected in the UK Finance findings) include the following:

  1. The need to stop fraud at its source with companies, including financial services, properly incentivised to combat fraud.
  2. Recognised the work the financial sector took and worked with the government in prevention; nevertheless, challenges them to go even further in partnership cooperation in making it ever more difficult for fraudsters to operate. One of the strategy objectives to target this is to work more closely with industry to make sure intelligence is better shared with each other as well as law enforcement and action taken to stop fraud.  This includes through industry member bodies such as UK Finance which recently reiterated its own fraud findings in its recently published fraud report. The strategy also recognises the valued work of CIFAS as the UK’s largest cross-sector fraud information sharing database for prevention and detection purposes.
  3. Stop people from hiding behind fake companies for fraud purposes. It highlights fraudsters abuse of the UK’s framework for company registration and filing to commit crime. In particular, through creation of companies specifically to perpetrate fraud as well as use of an individual or business’s personal details or address without their consent. Likewise, obscuring ownership and control of a company for financial crime purposes.  The Economic Crime and Corporate Transparency Bill, currently before Parliament, seeks to tackle these issues through greater powers for Companies House; including, new powers to check, challenge and decline dubious information, supported by stronger analytical and intelligence sharing capabilities making abuse and fraud easier to spot.
  4. Fraudsters increasingly adapt and use increasingly sophisticated tactics and technology to commit fraud against their victims and highlights the importance for the financial sector to maintain their focus and use of the latest anti-fraud technology for prevention and detection. The strategy highlights the importance of empowering people and businesses with the tools and knowledge to keep themselves safe from fraud.
  5. It further commits to making fraud a policing priority, with increased funding and an MP (Anthony BROWNE) specifically appointed as anti-fraud champion to drive delivery and increase industry collaboration. One means in which it recognises the financial sector has taken to fraud prevention is stronger customer authentication.  It commits to further protecting people from becoming victims of identity fraud and recognises the value in digital technology.

What is Ultimate Finance’s strategy for stopping fraud at source?

  1. We are a member of UK Finance as well as CIFAS and collaborate and share information with the aim of preventing fraud at source e.g., on application. This includes identity fraud involving both individuals and companies.  We also work with other partners such as Acquis Data Services in the fight against Asset finance fraud.  Through these member collaborations and fraud data sharing we have not only prevented fraud targeted at Ultimate Finance but also other members as well as protecting companies and individuals from falling victim to identity and other frauds – in line with the government’s fraud strategy.
  2. We have robust adaptive customer due diligence (CDD) procedures; including latest state of the art digital technology, empowering our staff with the ability to identify, authenticate and verify the identities of individuals and companies and the information they provide in real time. Likewise, robust CDD procedures to identify those who seek to hide behind corporate structures for criminal purposes – including financial crime and fraud.
  3. We regularly train our staff on financial crime and fraud prevention as well as collaborating closely with our partners such as our brokers and introducers in raising awareness of our financial crime and fraud prevention expectations and procedures.

In summary:

To prevent both you and your company becoming a victim of fraud; including identity fraud, Ultimate Finance would refer you back to UK Finance report and campaign on fraud prevention i.e., Take Five to Stop Fraud as well as our own Being Fraud Aware online publications as further detailed.

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