Increase in Insider Threats Rises by 14% Yearly Amidst Financial Struggles

In the current economic climate of the UK, a significant concern has emerged for businesses: employee fraud. The anti-fraud non-profit organisation, Cifas, attributes this growth to opportunities afforded by remote working.

The 2024 Fraudscape report, published by Cifas, highlights a number of key concerns. One of these is the theft of corporate data to support new employment. Another is the increased risk of employees contracting out duties to third parties.

Tracey Carpenter, Cifas's Insider Threat Manager, emphasises the importance of monitoring employees throughout their entire lifecycle. She also stresses the need for increased staff awareness through counter-fraud prevention training and a focus on staff wellbeing to support employees.

The most common reason for the increase in recorded individuals was dishonest action to obtain benefit by theft or deception, accounting for 49% of cases. In 2023, 17% of employees who engaged in dishonest conduct had been in employment for over a decade, while a higher percentage (38%) of employees who engaged in such conduct had been in their position for less than a year, compared to 21% in 2022.

Interestingly, in 2023, 80% of employees who were recorded for bribery had also been working for more than 10 years. Reduced supervision due to widespread remote working provided greater opportunity for employees to engage in dishonest behavior, such as holding a second job or selling corporate devices and loyalty discounts via online marketplaces.

Despite a 9% year-on-year (YoY) decline in filings to the Cifas National Fraud Database (NFD) in 2023, there were significant increases in facility takeover (13%), misuse of facility (5%), and asset conversion cases (55%). As a result, NFD filings were still 4% above 2021 figures.

The pressures of the cost-of-living crisis in the UK are a factor in the increase in dishonest actions by employees to obtain benefits. Tracey Carpenter suggests that small changes can significantly reduce the risk of insider threat and keep workforces safe.

Employers are urged to be aware of the increased risk of employee fraud due to remote working and the current economic climate in the UK. Carpenter emphasises that small changes, such as increasing staff awareness and focusing on staff wellbeing, can make a significant difference in reducing the risk of insider threats.