Business Fraud Prevent Detect Act

1. Business FraudPreventDetectAct DC Stephen Crooks OCB Financial Crime Unit

2. FRAUD RISKS Staff Fraud: • Employment application fraud • Unlawful obtaining/disclosure of personal data • Unlawful obtaining/disclosure of commercial data • Account fraud By abusing position – identifying weaknesses or opportunity to commit fraud Click here to download a copy of Staff Fraudscape. An interactive contents page will help you to pinpoint sections of particular interest.

3. FRAUD RISKS • Mandate fraud • Long/Short Firm fraud • Card Not Present (CNP) fraud • Fraudsters hijacking your website to redirect orders to their server • Scams and Phishing attacks – to get access to the company’s banking details • Website traffic diverted to bogus site – cloned site e.g. near-misspelling • Publishing/Trade Directory scams

4. FRAUD RISKS Private Sector Fraud £45.5 billion _________ Increase from £38.4 billion in 2011 £30.5 billion 2009 and £14 billion in 2008

5. FRAUD FACTS – Fraud Advisory Panelwww.fraudadvisorypanel.org An introduction to fraud indicators • Prevention and early detection of internal fraud are always preferable to intervention after the event. Once a fraud has become firmly established or entrenched within an organisation, the financial, legal, reputational or regulatory ramifications will be considerably more severe. One very effective method of prevention is the pro-active identification of fraud indicators.

6. FRAUD FACTS – Fraud Advisory Panelwww.fraudadvisorypanel.org Anti-fraud policy statements • An anti-fraud policy establishes guidelines for preventing, detecting and dealing with fraud. It also sends out a clear message to staff and third parties about conduct that will not be tolerated by an organisation.

7. FRAUD FACTS – Fraud Advisory Panelwww.fraudadvisorypanel.org Anti-fraud policy statements – sample • The following example of an anti-fraud policy statement should be used as a guide only. The content of your anti-fraud policy will depend upon the nature, size and complexity of your business.

8. FRAUD FACTS – Fraud Advisory Panelwww.fraudadvisorypanel.org Pre-employment screening • It is estimated that almost one in seven CVs contain some form of discrepancy – most commonly dates of employment, academic and professional qualifications and undisclosed directorships*. Pre-employment screening can help your organisation to identify undesirable individuals, who may be dishonest or susceptible to committing fraud, before they join.

9. FRAUD FACTS – Fraud Advisory Panelwww.fraudadvisorypanel.org Business fraud detection • Fraud detection should form part of an organisation’s overall anti-fraud strategy to identify and stop new or historical fraud at the earliest opportunity. Effective fraud detection saves money and protects businesses and their employees, shareholders and customers.

10. FRAUD FACTS – Fraud Advisory Panelwww.fraudadvisorypanel.org An introduction to fraud investigations • Businesses should be prepared to act immediately on suspicions of fraud. Whether investigations are conducted in-house or by a third party, it is important that your organisation has a basic understanding of the investigation process and what you can and cannot do.

11. FRAUD FACTS – Fraud Advisory Panelwww.fraudadvisorypanel.org Fraud reporting a shared responsibility A report by the Fraud Advisory Panel

12. FRAUD FACTS – Fraud Advisory Panelwww.fraudadvisorypanel.org Fraud in smaller businesses • Small and medium-sized businesses (SMEs) are particularly vulnerable to fraud in times of economic downturn; many lack the controls found in larger organisations and do not necessarily have the resources to combat certain types of fraud. This factsheet highlights some of the key areas of fraud risk.

13. FRAUD FACTS – Fraud Advisory Panelwww.fraudadvisorypanel.org Corporate identity fraud • The term ‘corporate identity fraud’ is commonly used to describe the impersonation of another company for financial or commercial gain. Fraudsters steal your company’s identity and/or financial information and use it to purchase goods and services, obtain information or access facilities in your company’s name. • CIFAS Protective Registration http://www.cifas.org.uk/pr

14. FRAUD FACTS – Fraud Advisory Panelwww.fraudadvisorypanel.org Supplier and outsourcing fraud • Whenever an organisation acquires goods or services from another party, or looks to outsource an internal function to an external organisation, there is a risk of fraud, which potentially could result in significant losses and reputational damage.

15. FRAUD FACTS – Fraud Advisory Panelwww.fraudadvisorypanel.org Bribery and corruption • On 1 July 2011 all of the UK’s existing law on domestic and foreign bribery was replaced by the Bribery Act 2010. The new framework is premised on four key offences: bribing, being bribed, bribing a foreign public official; and a corporate offence when a commercial organisation has failed to prevent bribery being carried out on its behalf by a person associated with it. This new regime imposes serious sanctions, financial and custodial, and businesses need to take steps to ensure they do not fall foul of its wide-ranging powers.

16. Evidential Packages Evidential packages should contain all relevant information surrounding the allegations made. Evidential packages should include as a minimum: • A comprehensive report outlining the nature of the allegations including values and relevant dates. The full name address and DOB of the suspect, or suspects • A full description of any investigations already undertaken. • Copies of all relevant documents, each individually numbered and identified in the summary.

17. Evidential Packages • Names, DOB addresses and other contact details of all witnesses identified at the time of reporting to the police. • Copies of all witness statements obtained (typed). • Any police reference numbers that may already apply to any part of the case, i.e. C&C, NICHE etc. • A name and contact details for the officer dealing with the case

18. Schedule of Witnesses Where more than two or three witness statements are provided, it is essential to list them on a schedule. The Schedule should • identify each witness • outline, in brief, the evidence in chief each witness will provide • detail the Exhibits each witness will produce It should also be noted that – UNDER NO CIRCUMSTANCES SHOULD ORIGINAL DOCUMENTS BE FORWARDED.