Fraud costs financial services £3.8bn every year, reveals NFA
According to a latest report by National Fraud Authority (NFA) financial services is the hardest hit
Mortgage fraud is estimated to be around GBP1bn and over GBP2bn lost in insurance fraud, with fraud in plastic cards, online banking and cheques comprising most of the remainder. Credit and debit card fraud is estimated to be 0.1% of total transactions.
The new GBP30bn national fraud estimate is far more comprehensive than the last widely accepted figure of GBP13bn from the Association of Chief Police Officers (ACPO) report.
Based predominantly on 2008 data, the current fraud loss figures were collated by a specialist team at the NFA. Using information gathered from a cross-section of public and private sector agencies, the public sector accounts for 58% of the total figure, the private sector 31% and fraud against individuals the remaining.
The earlier figure captured only a proportion of the true fraud loss, as it only referenced publicly available information. The new higher figure is the result of the NFA collating previously unpublished fraud loss figures, and producing its own fraud estimates in areas where fraud data was unavailable.
The report and overall fraud loss estimate will enable the government's strategic lead agency on fraud and government to develop clearer priorities to prevent, detect and deter fraudsters and identify those areas of fraud that cause the most harm to the UK economy, to tackle it more effectively.
Bernard Herdan, CEO of NFA, said: "With this vital information we can develop clearer priorities to prevent, detect and deter fraudsters. We will use the data to help identify those areas of fraud that cause the most harm to the UK economy. Reducing the cost of fraud is important but even more significantly I want to stop more people from becoming victims. I have seen firsthand the devastating effects fraud can have. It destroys lives and livelihoods."