COVID-19 Fraud | Don’t Let Fraudsters Take Advantage of a Tough Situation
Despite the gradual easing of restrictions in the UK, the pandemic continues to be at the centre of the world’s focus.
The chaotic nature of the last year has provided a cover for fraudsters across the world and the thread of fraud for many of us is still very real.
Over the last 12 months, we have been highlighting some of the Covid-19 fraud cases and trends which have caught out many organisations, companies and people.
Action Fraud UK continues to highlight the key fraud trends relating to individuals. One of the current fraud trends are via text or emails pertaining to offer vaccines. Pauline Smith, Head of Action Fraud, said: “The vaccine is a crucial tool in fighting the coronavirus and keepingpeople safe. We have seen an increase in the last two months, particularly around scam text messages. Remember, the vaccine is only available on the NHS and is free of charge.”
The NHS will never ask you for your bank account or card details; PIN or banking password. NHS staff will never arrive unannounced at your home to administer the vaccine. The NHS will never ask you to prove your identity by asking for copies of personal documents such as a pay slip, driving licence or passport.
If you receive a call you believe to be fraudulent, hang up.
If you are suspicious about an email you have received, forward it to report @phishing.gov.uk.
Most individuals are now becoming more aware of these types of threats yet many are still vulnerable.
Awareness of potential threats, is key to risk management. By increasing our understanding of the these fraud trends we can protect friends, family and colleagues from harm.
More advice can be found at www.tenintel.com/corporate-fraud/covid-19-fraud-trends-and-cyber-threats/
In 2020 the UK Government implemented various relief and economy-boosting schemes as part of its coronavirus strategy. Yet, fraudsters have eyed up an opportunity, as Analyst Jake Durham reports:
Over the last few months, the team at TenIntelligence have been raising awareness and supporting the recent COVID-19 anti-fraud campaign and anonymous hotline initiatives led by CrimeStoppers, the Cabinet Office and HMRC.
The Government introduced various financial stimulus packages and schemes including, job retention, self-employment income support, statutory sick pay and the famous “Eat Out to Help Out” scheme, which according to government figures attracted £849 million in claims for 160 million meals in August 2020.
While there continues to be a debate over the effectiveness of the UK Government’s COVID-19 response, these schemes have provided a valuable lifeline to employers large and small.
The job retention furlough scheme (or CJRS) in particular has granted financial support to nearly 10 million people restricted from their jobs.
Anybody working in fraud prevention and due diligence will tell you that where there is opportunity, there is fraud.
So it was welcome news that HMRC and other enforcement agencies have partnered with CrimeStoppers to open a hotline and online form for members of the public to report so-called “COVID-19 Fraudsters”.
As of 12 January 2021 there have been 21,707 reports of alleged fraudsters targeting COVID-19 stimulus schemes.
Here are three of the most common reported types of COVID-19 fraud, and steps to take to protect yourself and your business:
In September 2020, HMRC’s Chief Executive Jim Harra disclosed a working assumption within HMRC that 5-10% of Coronavirus Job Retention Scheme (CJRS) payments were claimed fraudulently. A firm has committed furlough fraud if:
- It furloughs employees but requires them to keep working
- It does not tell the workers that they have been furloughed
- It claims compensation for workers who do not currently work for them
- The firm claims more money than it is entitled to
Authorities are cracking down on furlough fraud with investigations, hefty fines and in extreme cases prison sentences. HMRC recently released recommendations for reforms to the Finance Bill 2020 which if approved by Parliament, would grant the ability to hold directors directly accountable for tax charges if they have knowingly broken CJRS rules.
Many firms are victims of genuine error when claiming furlough reimbursement, but HMRC doesn’t discriminate. An investigation for CJRS fraud is a nightmare scenario for any business owner.
To avoid this scenario, firms should regularly audit their COVID compliance.
If you suspect compliance errors have occurred, consider a more forensic investigation, such as reviewing internal communications.
Eat Out to Help Out Fraud
Some eateries abused the “Eat Out to Help Out” scheme by submitting claims for takeaway and delivery food and alcoholic beverages that were not eligible for reimbursement. Misuse of the scheme can lead to criminal investigations including fraud by false representation, false accounting and conspiracy to defraud.
The government issued guidance on 2nd November for businesses seeking to repay wrongly claimed funds with a strict notification period of 90 days after receiving the unentitled payment.
There are around 4,000 restaurants facing potential probes by the HMRC and honest errors can and will occur, so eateries and their accountants should be sure to double-check their compliance before the grace period ends.
Scam Calls, Texts and Websites
Phishing scams/frauds have developed over the past year to take advantage of the governments use of texting to deliver official coronavirus alerts.
Fraudsters pretending to be from the government, GPs and the NHS have used calls, texts and fake websites to scam people out of their personal info and bank details.
Some frauds are obvious, while others convincingly mimic official UK Gov messages to direct marks to fake gov.uk and NHS sites which request their personal data.
Most recently, fraudsters have begun sending fake calls to register to get vaccinated. Employers can keep their employees safe and fight scammers by making them aware of phishing scams.
If you or your employee receives a suspicious call or text it should be reported to Action Fraud by calling 0300 123 2040 for investigation.
- The NHS will never ask you for your bank account or card details.
- The NHS will never ask you for your PIN or banking password.
- The NHS will never arrive unannounced at your home to administer the vaccine.
Previous editions of TenInsight can be found here: