Three quarters of fraud professionals back mandatory reporting, study finds
Three in four fraud professionals back mandatory reporting about instances of the UK’s most common crime according to a new survey.
Under current legislation there is no requirement for a company to report fraud to law enforcement and little incentive for them to do so unless a criminal prosecution is sought.
An overwhelming majority of the 200 professionals surveyed backed introducing legislation to enforce mandatory reporting, with two-thirds of those in favour saying it should be compulsory in all instances, irrespective of financial impact.
“We need to raise our collective game very substantially to meet the enormous challenge that fraud poses, and this will require key changes, including the possibility of mandatory fraud reporting,” said David Clarke, Chairman of the Fraud Advisory Panel which commissioned the survey along with the UK Chapter of the Association of Certified Fraud Examiners (ACFE).
While professionals were nearly unanimous in their conclusion about reporting the survey found that many businesses are reticent to come forwards if they have been the victim of financial crime.
Some businesses were concerned about being perceived as an easy target for criminals if they reported they had been a victim of fraud while others were concerned about reprisals by regulators and insurance companies.
Tim Harvey of ACFE said, “taken in the round, these findings point again to the urgent need for a cohesive approach to tackling fraud based on sound strategy and sufficient resources. The survey finds strong support for the idea of a statutory approach to mandatory reporting but there’s also plenty of scepticism about its likely vigour and rigour.”
Financial crime is believed to cost the UK economy billions each year. While it’s estimated that UK losses from fraud amount to £52bn each year cases totalling just £742m appeared before British courts in 2020.
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