Remote working and virtual actions such as sign-off processes, plus charities’ tendencies to show goodwill and trust in individuals, may make them especially vulnerable to fraud, the watchdog the Charity Commission has warned. It says that charities providing services and supporting communities could be among those at risk after earlier reports of criminals using PPE as a lure in scams.
Analysis of frauds reported to the Commission has found that in some cases fraudsters have preyed on people’s fear and anxieties. In one case, the regulator saw a fraudster using a beneficiary’s story of personal struggle during the pandemic to pressure a charity into making a payment quickly. The regulator also considers that economic hardship may have increased perpetrators’ temptation to commit fraud, particularly in cases of insider fraud. It has seen cases of charity employees diverting funds into their personal bank accounts and even selling charity equipment for personal gain.
Helen Stephenson CBE, Chief Executive of the Charity Commission said: “We are seeing evidence that opportunists may be taking advantage of charities during the pandemic and I urge all charities to be extra vigilant against fraud.
“This comes at a time when charities are a lifeline for many people suffering from Covid-19, and the wider impacts of the pandemic – charities have been at the forefront of responding to the crisis, and many have also been placed under severe financial strain. As our country faces another challenging point in the crisis, we cannot afford for charitable work to be disrupted by criminals. When fraud hits charities, its impact is felt far beyond the balance sheet – it is people that are let down, often hard-working volunteers or people in desperate need. That’s why I’m urging all trustees to take action now, to protect their charity’s valuable funds and assets.
“Charity brings immense value to society, not just through the good work charities do directly, but also in its power to promote cohesion, well-being, and pride in our society. This is more important than ever, so the fact that there are those who wish to exploit public generosity and charitable endeavour for selfish, criminal purposes is appalling. Combating fraud is vital to giving people confidence that their money is safe and will go to the causes they care so deeply about.”
Charities can find free tools and advice via an online hub as part of Charity Fraud Awareness Week, arranged by the Fraud Advisory Panel (itself a charity).
For more visit https://www.gov.uk/government/news/charity-fraud-awareness-week-2020.
More in the December 2020 print edition of Professional Security magazine.
