Small companies losing £8bn to fraud

UK small businesses are losing an average of more than £2,500 each to card scams and identity theft

Fraud

Nearly 286,000 small businesses across the UK have been the victim of fraud, a new study by Experian has found, losing a total of nearly £8bn during their time in business.

The information services company polled 500 SME bosses and 13pc have been the victim of a card, cheque or identity fraud.

SMEs with more than nine employees were the most likely to have fallen victim to fraud, with 27pc reportedly losing money to fraudsters, while just one-in-10 micro businesses reported fraudulent activity.

Among UK SMEs that have been victims of fraud, the average amount of money lost was £2,627, but 1pc of SMEs overall lost £10,001 or more.

Ade Potts, managing director of Experian’s SME business, said: “Some of the smallest of businesses in the UK are just as likely to become victims of fraud as their larger counterparts. No matter what the size of the loss, whether it is £1,000 or £10,000, an unplanned loss can have a big impact on a small or medium-sized business, both financially and operationally.”

Last year, Financial Fraud Action UK (FFA) warned small firms of an upsurge in two scams in particular: invoice fraud, where criminals send in fake requests for payment, and phone fraud, where companies are telephoned and tricked into revealing important payment details.

FFA director Katy Worobec said: “Criminals are turning their attention to businesses because successfully scamming a company can net the fraudster a much bigger haul than they could steal from an individual.”

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