Last year Cifas reported a 57% increase in fraud, with 88% of this occurring online. The total cost of fraud to the UK stands at £144 billion, and the estimated cost to the charity sector is £1.9 billion. This is money that’s ending up in the hands of fraudsters rather than charities and the causes they serve.

It’s not right that the cost of fraud is spiralling out of control. It’s not right that people and businesses are being stung by scams.

It’s time for a change. It’s time to fight back.

 

Supporting Counter Fraud Campaign

Yoti is a business, but we believe Yoti can be a force for good to help millions of people around the world. We’re a company on a mission. We’re built on principles of transparency and trust and want to help people use our technology to make it quicker, easier and safer for people to prove who they are and know who they’re dealing with.

As part of our social purpose work, we use our financial, people and physical assets as a force for good. So we are very proud to be supporting the Charity Finance Group’s Counter Fraud Campaign. The campaign aims to help charities be aware of the different fraud risks and how they can protect themselves against these. We’re delighted to have signed the Counter Fraud pledge – pledging that we will take active measures to help prevent and combat fraud.

 

Different types of charity fraud

Knowledge is power. Being aware of the different types of fraud and the potential warning signs is the first step to help protect your charity:

  • Fake charity websites – it is very easy for someone to set up a fake but realistic website using it as a cover and disguise for their scam. The money ends up in the hands of a fraudster rather than the charity. You can check the authenticity of the charity with the Charity Commission – all charities need to be registered and have a licence.
  • Unauthorised fundraising in a charity’s name. This scams plays on the sympathy and goodwill of others by asking them to make a donation to a cause. In an increasing number of cases the fraudsters are misusing genuine charity names and then pocketing the money for themselves.
  • Phishing scams – this is one of the most common techniques used by fraudsters. Phishing involves criminals, claiming they represent a financial company, supplier or even someone from the charity’s senior team, sending unsolicited emails to an unsuspecting employee or volunteer. Warning signs of a phishing email include:
    • You’re asked to follow a link and enter login details
      The email says you need to verify payments and transactions on the charity’s account
    • Spelling mistakes or bad punctuation and grammar
    • Receiving emails from financial institutions your charity has no relationship with.
      The Charities Aid Foundation has some great advice on how to avoid phishing scams.

The risks of fraud do not just come from external sources though. Last year the Charity Commission revealed that more than a third of fraud incidents reported by charities were committed by staff, trustees or volunteers.

Professor Mark Button, counter fraud expert says that typically smaller charities are targeted by fraudsters because they have fewer internal checks in place and fewer resources (both time and people). This means that one person could be in charge of all of the finances for the charity, making it far easier for a fraudster to cover their tracks. Internal fraud risks include:

  • Employees keeping cash or cheque donations
  • The charity credit or debit card being misused, and / or claiming false expenses
  • Employees overriding financial controls.

As a supporter of the Counter Fraud Campaign, we’re proud to be fighting back to tackle fraud together.

 

If you’ve got a question about how Yoti can help your charity, please get in touch.

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