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Information: increased fraud risk during coronavirus (COVID-19) pandemic

Periods of instability, such as during the coronavirus pandemic, bring an increased risk of fraud. Fraudsters will actively exploit these difficult times and will target vulnerable areas for financial gain.

ActionFraud reported a 400% increase in reports of coronavirus related fraud in March 2020. The reported frauds are varied and include:

  • charity fraud
  • online shopping fraud
  • phishing emails

Further information is available on the ActionFraud website.

Periods of instability lead to increased pressure, which in turn may lead to reduced internal controls and management oversight, making organisations more vulnerable to fraud risks.

During these periods staff wanting to be helpful and flexible when dealing with suppliers can be more susceptible to targeted attacks from fraudsters, particularly around changes to payment details.

Remember, fraudsters can be very convincing, they are used to exploiting organisations and will have prepared thoroughly.

Organisations should continue to follow all business processes and procedures designed to protect them from fraud. Below are some key actions for all organisations during the corona virus pandemic and other periods of instability:

  1. Maintain effective governance and financial management and oversight. Periodically remind staff that, despite the instability, the organisation continues to implement and require compliance with internal controls.
  2. Maintain strong internal controls and retain and implement clear policies and procedures. Provide further training on these policies and procedures where required.
  3. Maintain and promote strong anti-fraud controls. Review internal control risk assessments and fraud risk assessments. Ensure that staff know how to report suspected fraud.
  4. Undertake internal audits to monitor internal controls and segregation of duties to ensure they are operating effectively.