UK Internal Fraud Levels are over 10 percent Higher than Global Average

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by Nathan Baldwin on


  • Internal fraud rates in Britain are over 10 percent higher compared to the global average.

  • Over a quarter of UK business execs don't see internal fraud as a high priority risk for their business

A 2019 global research study led by risk mitigation specialists Kroll, found that internal fraud was 10 percent more likely to happen to UK businesses compared to the global average. According to the report, 38 percent of businesses in the UK experienced internal fraud, compared to the global average of 27 percent.

The report found that despite being the most effected market in the world, one in four business owners didn’t feel the need to treat internal fraud as a high priority risk. This is not only leading to data being lost or stolen, potentially for malicious purposes, but also severely damaging the reputation of UK businesses, both nationally and globally. As the report highlights, 42 percent of UK businesses experienced reputational damage due to internal fraud incidents, 13 percent higher than the global average.

Why are UK business owners failing to act on internal fraud?

The report surveyed around 50 senior executives whose roles aligned closely to managing risk strategies. Almost a quarter of those surveyed stated that they did not consider internal fraud a high-risk priority to their company’s operations. When a survey asked lower level employees about their company’s risk management policies, 30 percent of respondents stated that there was no clear message communicated by the organisation heads that compliance and accountability where key to the company’s culture and operations. This is 20 percent higher than the global average.

This is where the report highlighted a key concern, compared to other businesses across the globe, UK business leaders don’t implement data security and protection into their core company culture. Without this, employees are less likely to consider data security as a constant priority, resulting in lapses in security and ultimately more internal security breaches.

Understanding internal fraud

A reason as to why so many businesses in the UK fall victim to internal fraud is that they simply don’t believe it could happen to them. Many employers underestimate the risk that an employee or somebody close to company databases/information could use it for improper or potentially malicious purposes. But, it is this complacency that leads to fragile security policies that can easily be breached from the inside.

There are many reasons why internal fraud can occur. Financial gain, reputational damage, destruction of assets can all play a part in why somebody would want to defraud a business. So, it is important that business leaders understand which parts of their business could be most vulnerable to attack.

Morson screening services

How can businesses limit the risk of internal fraud?

Identify the risk: a great place to start is to identify any vulnerable areas of the organisation, this could include the company’s finance or payroll department, or client information databases, any sensitive information that could potentially damage the company if it was misused. Based on organisational structure, this process can be a time consuming and expensive process, but hiring a specialist third party company to assess vulnerable areas can be an effective measure to take to understand the full risk.

Company culture: one problem that was made apparent from the Kroll report was that UK businesses aren’t implementing data security policies into their core culture. This means that employees working at every level do not consider security as a day to day responsibility and unintentionally create opportunities for internal threats to occur. Conducting internal training days or events are a great way to engage with employees and help them understand why internal security is so important and how they can limit risk.

Invest in pre-employment screening policies: prevention is often better than that the cure, so understanding who you are employing and if they could potentially cause a threat to your business before you hire them, is the best measure to take to limit the risk of insider fraud.

At Morson Screening Services we provide specialist background screening services to industries where insider fraud could have a huge impact on a businesses reputation. Our vetting coordinators specialise in 12 sectors across the UK to provide bespoke screening processes to clients specialising in high priority industries, including Military and Defence, Aerospace and Nuclear. 

Contact a specialist: many companies spend years implementing new security policies into the organisation but handling a project of that size and scope internally not only requires a lot of time and resources, but also doesn’t ensure a business is 100 percent risk free. Investing a little at the start can save a lot in the future. If you would like to find out more information about how Morson Screening Services can make your business more secure, get in touch with us today at or call us on 0161 707 1516.

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