A study by the UK not-for-profit fraud prevention trade body, Cifas, suggests that nearly half (48 per cent) of adults believe it is ‘reasonable’ to commit first party fraud. That’s when someone knowingly misrepresents their identity or provides false information for financial or material gain. It’s on the rise, Cifas suggests; examples include exaggerating salaries on mortgage applications, ordering goods online and falsely claiming they have not been delivered to obtain a refund, or agreeing to use their bank account to transfer illicit funds (known as money muling).
Cifas’ latest ‘Fraud Behaviours’ survey presented 2,000 UK adults with ten first party fraud scenarios. Respondents were asked if they thought the actions described were reasonable or unreasonable, legal or illegal, and whether they themselves had done the same, or knew someone who had, over the last 12 months.
The most common first party frauds, according to the survey:
Retail non-delivery – falsely claiming an item of clothing had not been delivered, even if it had been worn, to obtain a refund (19 per cent)
Falsifying CV qualifications – lying on a CV and/or job application to land a role (18pc)
Single Person Discount fraud – deliberately continuing to claim Single Person Discount to reduce a council tax bill, even where people had moved their partner into their home permanently (16pc)
A good fifth (23pc) of respondents said that selling a car on a hire purchase agreement and continuing to make repayments to the finance company after it was sold – known as asset conversion fraud – was the ‘most reasonable’ type of first party fraud ahead of money muling (17pc). A third or more of individuals (36pc) did not regard asset conversion fraud as illegal. Similarly, more than one in five (22pc) thought that money muling was legal, and 19pc believed the same for mobile phone insurance fraud. Those aged 25 to 34 (19pc) were the group most likely to be involved in first party fraud according to the survey responses.
Mike Haley, CEO of Cifas, pictured, said: “First party fraud is too often seen as a victimless crime. But the truth is very different. It is a growing threat and causes significant harm to individuals, businesses, and communities, and can result in severe repercussions for perpetrators.
“It is only through effective, cross-sector collaboration and education that we can collectively improve public awareness and ensure consumers have a greater understanding of the true dangers of first party fraud and its lasting impact.”
