SMEs are collectively losing a total of £144 billion a year through fraud, with £12 billion being lost through payroll.

According to a report by UK Fraud Costs Measurement Committee, payroll fraud is responsible for 8% of losses among private businesses. The biggest source of fraud is procurement, causing annual losses of £127 billion.

The total annual cost of fraud in the UK per year is as high as £193 billion.

Other types of fraud impacting businesses include:

• Charity fraud which accounts for losses of £2 billion per year
• Insurance fraud costing £1.3 billion a year through illegitimate claims.

Fraud in the public sector has resulted losses of around £37.8 billion, equivalent to just 5.5 % of the £694 spent annually.

Tax fraud costs £15.4 billion per year which equates to 3% of the total tax revenue.

Chris Clark, UK&I CEO at Experian, said:

“Although 95% of the fraud taking place is not a direct to end consumer cost, those lost funds are passed on to individuals in the form of higher costs on products and services.”

Simon Dukes, chief executive of fraud prevention organisation Cifas, added:

“To avoid known fraudsters entering the workplace, we recommend HR teams conduct thorough vetting and check to ensure prospective employees have not been involved in fraud before.”