UK SMEs Lose £8bn to Company Fraud
Fraudulent activity affects more than one in eight of the UK’s small and medium-sized enterprises (SMEs), with nearly 286,000 firms reporting a cumulative loss of nearly £8bn (US$12.3bn/€10.8bn) during their time in business according to research by Experian.
The global information services company comments that fraud has more often been associated with corporate espionage, high profile scams and fraudulent activity in large enterprises. However, the findings suggest an increasing need for UK SMEs to also protect themselves from card, cheque and identity fraud.
Thirteen per cent of UK SMEs have been the victim of company fraud, and 27% of SMEs with more than nine employees were most likely to have fallen victim to fraud, while 11% of micro businesses (one to nine employees) have suffered losses.
Among UK SMEs that have been victims of fraud, the average amount of money lost was £2,627, but for some, the loss of money due to company fraud was much greater:
The findings are included in Experian’s SME Reputation Index. Investigating the attitudes of over 500 senior decision makers in SMEs across the UK, the Index reveals attitudes towards safeguarding financial reputation.
“Some of the smallest of businesses in the UK are just as likely to become victims of fraud as their larger counterparts,” said Ade Potts, managing director of Experian’s SME business. “No matter what the size of the loss, whether it is £1,000 or £10,000, an unplanned loss can have a big impact on a small or medium-sized business, both financially and operationally.”
Among the top tips offered to SMEs: