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Survey highlights extent of fraud and cyber crime

Nearly six million cases of fraud or cyber crime were recorded in England and Wales last year, according to new figures from the Office for National Statistics (ONS).22 Jul 2016

The ONS' Crime Survey for England and Wales (CSEW) revealed that there was an estimated 3.8 million fraud offences and 2 million computer misuses offences in the year ending March 2016.

The data is based on interviews conducted with residents in England and Wales between April 2015 and March 2016 and measures their experiences of crime in the 12 months prior to the interview. 

"This is the first time we have published official estimates of fraud and computer misuse from our victimisation survey," John Flatley, who is involved in crime statistics and analysis at the ONS, said. "Together, these offences are similar in magnitude to the existing headline figures covering all other Crime Survey offences. However, it would be wrong to conclude that actual crime levels have doubled, since the survey previously did not cover these offences. These improvements to the Crime Survey will help to measure the scale of the threat from these crimes, and help shape the response.”

According to the ONS figures, 66% of the fraud cases experienced related to bank and credit account fraud. There was an estimated 2.5 million incidents of this kind, the ONS said. Most of the remaining fraud cases could be classed as 'non-investment' fraud. There were an estimated 1m such cases in the period covered by the survey and include "fraud related to online shopping or fraudulent computer service calls", the ONS said.

The computer misuse incidents were either "computer virus related" or "related to unauthorised access to personal information", such as through computer hacking, the ONS said. There were 1.4m computer virus cases and 600,000 data accessing incidents, it said.

The CSEW also reported on the likelihood of fraud and cyber crime victims to recover any losses.

"Incidents of bank and credit account fraud were more likely to result in initial loss to the victim (70%, equivalent to 1.7 million) than other types of fraud," the ONS said. "In the majority of these incidents, the victim received a full reimbursement (84%)."

"In 49% of non-investment frauds (such as fraud related to online shopping scams or fraudulent computer service calls) and 76% of all other frauds (for example, lottery scams, pyramid or Ponzi schemes or charity fraud) there was no loss to the victim. This compares to 30% of incidents of bank and credit account fraud where no loss was suffered," it said.

Less than a quarter of computer misuse offences (22%) "involved loss of money or goods", the ONS said.

Civil fraud and asset recovery specialist Alan Sheeley of Pinsent Masons, the law firm behind Out-Law.com, said: "The inclusion of fraud offences and computer offences in the ONS figures will assist in presenting a more accurate picture of reported crime levels in the UK. However, it is also important that those reviewing the ONS’ figures understand that this is likely to be the tip of the iceberg."

"Many frauds and computer misuse offences are either unreported, whether for fear of reputational damage or embarrassment, or have not yet been uncovered. The true level of fraud will be much higher and the threat of fraud remains ever present," he said.

Sheeley said it is important that individuals and businesses are alive to the threat of fraud and "the devastating impact it could have on their operations".

"Businesses must be prepared to prevent, detect and respond to a fraud and that requires effort and commitment by senior members of the organisation," Sheeley said. "They should undertake risk assessments and carry out audits on their operations to identify areas of concern or risk exposure which may require further investigation or action. The 'message from the top' needs to demonstrate that fraud will not be tolerated. It needs to inspire confidence in management that the organisation will take the necessary steps to root out fraud and take protective measures if it falls victim to a fraud."

"A business which takes decisive action against wrongdoers to recover its losses will be sending a clear message that it will not suffer silently and that the fraudsters will not be allowed to walk away with their ill-gotten gains without a fight," he said.

"Until businesses and individuals take the necessary measures to protect themselves from the risk of fraud, by implementing appropriate policies and undertaking risk assessments, and until they respond to a discovery of fraud by commencing civil proceedings to recover any losses and pursuing fraudsters through the courts, I expect the ONS’ figures for levels of fraud and computer misuse to continue to increase with ever expanding levels of losses," Sheeley said.