Circa 50% of UK adults believe first party fraud to be “acceptable” states Cifas

First party fraud is committed when someone knowingly misrepresents their identity or otherwise provides false information for financial or material gain. Cases of such fraud are on the rise.

Examples include exaggerating salaries on mortgage applications, ordering goods online and then falsely claiming they have not been delivered in order to obtain a refund or agreeing to use personal bank accounts to transfer illicit funds (which is known as money muling).

Different scenarios 

Cifas’ latest Fraud Behaviours Survey presented 2,000 UK adults with ten different first party fraud scenarios. Respondents were asked if they thought the actions described were reasonable or unreasonable as well as legal or illegal, and also whether they themselves had done the same (or knew someone who had) over the last 12 months.

The most common types of first party fraud unearthed by the Cifas study are as follows:

*Retail non-delivery – falsely claiming that an item of clothing had not been delivered, even if it had been worn, in order to obtain a refund (19%)

*Falsifying CV qualifications – being deceptive on a CV and/or job application to land a new role (18%)

*Single Person Discount fraud – deliberately continuing to claim Single Person Discount to reduce a Council Tax bill, even where individuals had moved their partner into their home on a permanent basis (16%)

Asset conversion fraud

Nearly on quarter (23%) of respondents said that selling a car on a hire purchase agreement and continuing to make repayments to the finance company after it was sold – known as asset conversion fraud – is the ‘most reasonable’ type of first party fraud ahead of money muling (at 17%).

Alarmingly, over one-third of individuals (36%) did not regard asset conversion fraud as illegal. Similarly, more than one-in-five individuals (22%) thought that money muling was legal, while 19% believed the same for mobile phone insurance fraud.

According to the Cifas survey responses, those aged 25-34 (19%) are the group most likely to be involved in first party fraud.

Mike Haley, CEO of Cifas, explained: “First party fraud is too often seen as a victimless crime. The truth is very different. It’s a growing threat and causes significant harm to individuals, businesses and communities. Further, it can result in severe repercussions for perpetrators.”

Haley added: “It’s only through effective cross-sector collaboration and education that we can collectively improve public awareness and ensure consumers have a greater understanding of the true dangers of first party fraud, including its lasting impact.”

*Read the CIFAS Fraud Behaviours Survey results in full online