Small Medium Large Total Target
A Agriculture, Forestry and Fishing 1 0 0 1 3
B,D,E Mining and Quarrying; Electricity, Gas and Air Conditioning Supply; Water Supply; Sewerage, Waste Management and Remediation Activities
1 5 6 12 35
C Manufacturing 17 21 50 88 83
F Construction 12 13 12 37 36
G Wholesale and Retail Trade; Repair of
Motor Vehicles and Motorcycles 79 50 69 198 182
H Transportation and Storage 5 3 15 23 25
I Accommodation and Food Service
Activities 1 5 7 13 14
J Information and Communication 2 7 14 23 28
L Real Estate Activities 5 1 2 8 7
M Professional, Scientific and Technical
Activities 15 12 22 49 35
N Administrative and Support Service
Activities 1 11 16 28 25
P Education 1 0 0 1 1
Q Human Health and Social Work Activities 3 2 0 5 9
R Arts, Entertainment and Recreation 1 1 8 10 12
S Other Service Activities 3 1 0 4 5
Total 147 132 221 500 500
Target 152 111 237
The sample size achieved represents a confidence interval of +/-4.4 per cent on a 50 per cent finding if a random probability design is assumed. Of the 500 sample, 136 businesses had experienced fraud. Broken down by size, the responses of small businesses represented 30 per cent of turnover, medium businesses 15 per cent and large businesses 55 per cent. The final data were weighted to make them representative of size of businesses. The percentage fraud loss estimate for detected fraud included two outliers that were specific to the small business detected fraud loss. In this case there were two small businesses that identified significant fraud losses. The transcripts from the interviews were reviewed and the fraud losses were considered valid. The two cases were therefore not removed from the detected fraud loss calculation for small businesses to ensure that the estimate did not exclude such significant losses, although it is not clear to what extent these losses are representative of small businesses. If the outliers had been removed, the detected fraud loss figure for small businesses would have been £1.2 billion which equates to 0.14 per cent of turnover in the sector. The two cases identified above did not have any effect on the medium and large business detected fraud losses or any of the undetected fraud loss estimates.
Private sector qualitative research
The qualitative sample was heavily informed by the findings of the quantitative study. A number of characteristics were used to ensure the qualitative interviews incorporated a wide variety of views and experiences. The in depth interviewees were selected on the following basis:
• Sector: Ensuring a spread of organisations from different sectors as they are likely to experience fraud in different ways and the NFA wanted to explore each of these
• Size of business / turnover: The NFA ensured that a spread of different sized businesses were included across the sample.
• Experiences of fraud: The NFA ensured that it included businesses with different experiences of fraud in the sample. These can be divided into two different sampling considerations:
– experience of fraud vs. no experience of fraud;
– experience of different types of fraud, for example, procurement fraud, ID fraud and cyber enabled fraud etc.
• Estimates of undetected fraud: The NFA ensured it was able to explore the reasons for businesses stating that they felt they have no levels of undetected fraud.
The qualitative interviews functioned to help the NFA to understand better the findings from the quantitative survey. They were also part of the validation exercise for the estimates identified for detected and undetected levels of fraud.
The sample was selected from those who had agreed to be contacted again by the researchers after the telephone survey. A sample size of 45 was agreed to ensure the NFA could explore the broad range of themes that it was interested in and this figure is within the principle of diminishing returns of qualitative research. The interviews consisted of a range of face to face and telephone interviewing and were spread geographically across the UK.
tor 2 01 3 65 Pu bli c S ec to r £20.6 billion
Tax system £14.0 billion Tax fraud £14.0 billion £14 billion
Vehicle excise fraud £40 million £40 million Unknown
Central government £2.6 billion
Procurement fraud £1.4 billion £1.4 billion
Grant fraud £504 million £504 million
Television licence fee evasion £204 million £204 million
Payroll fraud £181 million £181 million Unknown NHS patient charges fraud £156 million £156 million Unknown NHS dental charge fraud £73 million £73 million Unknown Student finance fraud £31 million £31 million Unknown Pension fraud £14 million £14 million Unknown National Savings and Investments fraud £0.40 million £0.40 million Unknown
Local government £2.1 billion
Housing tenancy fraud £845 million £845 million Procurement fraud £876 million £876 million
Payroll fraud £154 million £154 million Unknown Council tax fraud £133 million £133 million
Blue Badge Scheme misuse £46 million £46 million Unknown Grant fraud £35 million £35 million
Pension fraud £7.1 million £7.1 million Unknown Benefit and tax credits
systems £1.9 billion
Benefit fraud £1.2 billion £1.2 billion
Tax Credits fraud £670 million £670 million
*Black, red, amber, green (BRAG) Assessment: Confidence in Indicator
BRAG Level of confidence
Poor Average Good Excellent
Note:
Perceived level of confidence is based upon management assumptions and judgement to provide an illustrative indication of the quality of data available to produce an estimate. NB: It is not always possible to demarcate clearly the fraud by type estimates to identified or hidden losses as some estimates spread across both. Further, it should be noted that fraud cited as being ‘unknown’ does not mean that no fraud exists, but rather that no fraud has been identified, measured or is estimable. Not all fraud types are included in the breakdown due to the possibility of double counting. Due to rounding some figures may not add up exactly.
tor 2 01 3 66 Pri va te S ec to r £21.2 billion
Small, medium and large enterprises in the
UK £15.9 billion
Small enterprises £7.7 billion £4.6 billion £3.1 billion Medium enterprises £1.5 billion £44 million £1.4 billion Large enterprises £6.7 billion £555 million £6.1 billion
Financial and insurance
activities £5.4 billion
Insurance fraud £2.1 billion £39 million £2.1 billion Mortgage fraud £1 billion £1 billion
Plastic card fraud £388 million £388 million Unknown
Online banking fraud £40 million £40 million Unknown
Cheque fraud £35 million £35 million Unknown
Telephone banking fraud £13 million £13 million Unknown
Estimated other £1.8 billion Unknown £1.8 billion
Ch
ari
ties £147
million Registered charities in Great Britain £147 million
Income £0 – £100,000 £5.2 million £1 million £4 million Income £100,001 – £500,000 £16.3 million £11 million £5 million Income £500,001 – £5 million £23.0 million £14 million £9 million Income over £5 million £102.8 million £4 million £99 million
In di vid ual s £9.1
billion UK adult population £9.1 billion
Mass marketing fraud £3.5 billion £3.5 billion Unknown Identity fraud £3.3 billion £3.3 billion Unknown Online ticket fraud £1.5 billion £1.5 billion Unknown Private rental Property fraud £755 million £755 million Unknown Pre-payment meter scams £2.7 million £2.7 million Unknown
O
th
er £919