Half of UK companies are victims of economic crime

Half of all UK companies have been hit by fraud or economic crime in the last two years, according to a recent survey spanning more than 7,000 businesses globally, of which 146 were based in the UK.

For more than half of those affected, criminal activity resulted in losses of over £72,000, while almost a quarter (23 per cent) of UK victims admitted to losing more than £720,000.

Cybercrime was the most common crime, affecting 49 per cent of economic crime victims in the UK, compared to 31 per cent globally. This type of fraud has overtaken asset theft as the top crime for the first time.

Globally, 49 per cent of organisations said they have been victims of fraud and economic crime, with 64 per cent of the fraud damage reaching £1.4 million. Moreover, 52 per cent of all frauds are perpetrated by people inside the organisation.

Despite the seriously high numbers of businesses being affected by fraud and economic crime, only half of the 146 UK businesses that took part in the survey said they have carried out a fraud risk assessment in the last two years.

A spokesperson for the report says: “UK organisations told us that the cost and disruption of sorting out the aftermath, as well as the effect on employee morale, business relations, and brand are big hidden costs.”

He added that, “in this current period of rapid business change, understanding the risks and possible avenues for attack is more crucial than ever.”

Effective management accounts and company audits

When putting processes in place for effective business administration, sound management accounts will enable better control of your financial situation and awareness of the business in real time. This can be effective not only in detecting and countering fraud, but also in enhancing planning for the peaks and troughs. In turn, whilst many companies do not need an audit due to rising thresholds, an audit can give comfort to business owners and act as a fraud deterrent.

At Beavis Morgan, we work with SMEs to put processes in place which make it easier to run your business, reduce risk and maintain effective management of your company’s working capital.

Contact Steve Govey or your usual Beavis Morgan Partner for further information about how we can assist you and your business.

Click here for tips to help SMEs safeguard against cybercrime and be prepared.