Business Advice 09 January 2019

Crime has changed and fraud is now the most commonly experienced event for a business and yet fraudsters most powerful weapon is still a lack of awareness.

49% of organisations globally have said they have been a victim of fraud and economic crime. 

Fraud crime attributed to senior management rose quite dramatically from 16% in 2016 to 24% in 2018.

But the biggest weakness and therefore threat are those third parties a company does business with, agent, vendors, shared service providers and customers – “Frenemies”.  With 68% of external fraud being committed by this group.

As our real life case studies demonstrate fraud and economic crime can happen to a business whatever the size.

SME client

A local university contacted our client in order to purchase a selection of products from them.  Our client set up an account with reasonable credit terms and an order was placed for £20k worth of equipment. Delivery was arranged to arrive at the main campus, a few days prior to dispatch the delivery address was changed to an address in London. Due to lack of time this was not checked any further and the products were delivered. 6 months later, payment of the invoice had not been made and further investigation showed that the goods had been fraudulently stolen.

Commercial Client

A trusted financial controller embezzled £330,000 over a 2.5 year period by setting up false employees and accounts to hide the misappropriation. It was only when the client was notified by the bank of suspicious activity that the employee’s fraud was discovered.   The financial controller was prosecuted but a hole was left in the client’s profits.

Corporate Client

Shareholders set up a separate business and spent 18 months diverting stock over to the “other business” to the sum of £600,000, it was only via a whistleblower that they got discovered.

Personal Client

Our client was undertaking some building work to their residential property and had an email from from one of the builders asking for payment of £10k, which they duly paid.  It was then found that the builder’s email and bank details had been hacked and changed.  Unfortunately the builder did not have crime cover so the client has to try to recover the funds from their bank.

These incidents highlight significant losses for affected businesses, underscoring the necessity of including Crime cover in any comprehensive insurance plan. As an Anthony James client, we’re here to review your current coverage and address any inquiries you may have. For more on Crime cover and its benefits for your business, contact us at or call 01509 274000.