Tips from our webinar: Investigating fraud – current trends and future predictions
We concluded a series of forensic accounting webinars with a review of the fraud landscape which included highlighting trends from our recent investigations and expectations for 2023 and beyond. During the course of the year we have seen the collapse of cryptocurrency exchange FTX amidst allegations of fraud (which are yet to be established), a report suggesting over £4 billion was lost to fraud in the Government’s Coronavirus Job Retention, Eat Out to Help Out and Self-Employment Income Support schemes and the conviction of David Ames in relation to the Harlequin Group investment scam, amongst many other reports. The scale of the problem seems ever-increasing and we are inundated with eye-catching headlines concerning new scams and worrying statistics regarding the incidence and extent of fraud. We envisage the current economic headwinds are serving to create a perfect storm for a continued increase in fraud, including as a result of: Inflationary pressures, increasing interest rates, supply chain issues and volatile markets which can contribute to increased pressure on individuals and businesses; Staffing shortages, remote working and lingering COVID-19 may present fraudsters with an opportunity to bypass controls; and
Our webinar coincided with the release of the House of Lords report Fighting Fraud: Breaking the Chain. The report finds that fraud is the most commonly experienced crime today, comprising 41% of all crime against individuals, with losses in the last year reaching £4 billion. The report estimates 80% of fraud is cyber-enabled. Unsurprisingly, technology featured high on our agenda as it has become a key enabler for fraudsters to commit, conceal and communicate nefarious activities. While the situation may seem gloomy, there are reasons to be optimistic. Six steps were identified by the House of Lords report to break the fraud chain, and we will be interested to see how many of those recommendations are put into practice. We rounded off our webinar by looking at the benefits of utilising technology - it is critical for firms to put in place controls to mitigate nefarious activity and as a tool for investigators to catch them. The use of data analytics, blockchain technology, Artificial Intelligence and open source intelligence assists with the prevention and detection of fraud. The increase in speed and access to evidence from disparate sources Financial and funding challenges and volatile markets provide the rationalisation, particularly where business failure looms large.
2023 events
together with collaboration between different professionals including legal professionals, law enforcement, regulators and investigators across jurisdictions all contribute to an investigator’s toolkit. We acknowledge that if assets have been misappropriated, the cost-benefit analysis of undertaking an investigation may be questioned. On one hand, the perpetrator(s) could be identified, but for victims, the victory can be hollow if there is limited or no recovery of funds. Technology enables fraud investigators to work quickly and efficiently and assist with the key decision-making process.
Look out for our networking and webinar events across 2023.
At present we have a networking event in Birmingham planned for spring, with a new webinar series starting in spring/ summer, followed by two networking events in London and Cambridge across June and July. Finally in December we will be hosting our annual networking event in Norwich.
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