Over two thirds of charities (69pc) think fraud is major risk to the charity sector and internal (insider) fraud is recognised as one of the biggest threats, according to a survey released by the regulator the Charity Commission for the beginning of a charity fraud awareness week.
Yet although charities appear to be more aware that they can be at risk of fraud like any other organisation, the findings suggest that at least some charities are taking the view that it won’t happen to them, because they are not consistently putting basic checks and balances in place.
The survey, commissioned in March, also found:
– a third (34pc) think their organisation is not vulnerable to any of the most common types of charity fraud
– over half (53pc) of charities affected by fraud in the past two years knew the perpetrator
– most, 85pc of charities think they are doing everything they can to prevent fraud, but almost half don’t have any good-practice protections in place.
The findings were gone through by Commission chief executive Helen Stephenson at a launch event at Chartered Accountants’ Hall at Moorgate in central London, arranged by the Fraud Advisory Panel, itself a charity.
She said: “Charities have a responsibility to act,” and warned that charities will fall victim to fraud, unless they protect themselves. Charities who have not knowingly experienced fraud are potentially more susceptible to fraud, she said: “Finding fraud is the first step to fighting fraud.”
The gathering of counter-fraud and charity sector people (from food banks to the British Council) also heard from long-time awareness week supporter Pesh Framjee, partner at the audit firm Crowe; Michael Izza, chief executive of the hosts the ICAEW; and former policeman David Clarke, chairman of the Fraud Advisory Panel; besides Jo Pearce of Help for Heroes, Mark Baynham, head of counter fraud at Plan International, and Dominic Smyth, managing partner of the compliance firm and workplace investigators OSACO Group.
The event was chaired by BBC One Show presenter Kevin Duala, who’s revealed scammers preying on charities and the goodwill of people donating and seeking aid in ‘Britain’s Secret Charity Cheats’.
How to find out more
The Panel website has a downloadable Awareness Week supporters pack.
For a 12-page report, Preventing charity cyber crime: insights and action, visit the Charity Commission website.
More in the December 2019 print issue of Professional Security magazine.
