Risk Management and Fraud

Fraud losses are a huge problem in the UK with the annual cost believed to be in the region of £190 billion. Charities and charitable Trusts are also at risk and are thought to be losing £2.3 billion each year.

Trustees must be aware of their responsibilities in respect of protecting their charity against fraudulent activity, identifying any issues, and reporting to the Charity Commission where applicable.

The Charity Commission has lots of guidance available including information on how to spot fraud, as well as best practice to protect against it. Fraud prevention stems from good governance and effective culture and having the right people.

A large amount of fraudulent activity occurs from within the charity and therefore it is important to ensure the charity is adopting suitable controls, policies and procedures. This “Insider fraud” doesn’t just harm the charity’s finances but can also affect staff morale and the reputation of the charity.

A research report by the Charity Commission is available here which gives some great guidance on potential controls and reminds Trustees of their serious incident reporting requirements.

If you would like to discuss this with a member of our team please email Jack Steer or call us on 01772 821 021.