Covid-19 - Fraud Archives - Grunberg & Co

Charities lose £3.6 million to fraud during pandemic

admin — Tue, 20 Oct 2020 16:43:48 +0000

More than 645 charities have become a victim of fraud during the coronavirus pandemic, a major study has revealed.
The figures were published by the Charity Commission for England and Wales during Charity Fraud Awareness Week – the annual event designed to help not-for-profits strengthen their defences against crime and fraud.
According to the report, hundreds of criminal attacks against charities have cost the sector some £3.6 million in losses since the start of the pandemic in March.
However, the “true scale of fraud against charities is believed to be much higher, as fraud is known to be underreported”, said the Charity Commission.
So, why is charity fraud increasing?
The regulator believes that remote working, and the resulting virtual activities and sign-off processes, is enabling an environment beneficial to criminals.
Fraudsters may also be extorting charities’ “tendencies to place goodwill and trust in individuals”. The Charity Commission highlights one example where a criminal used a story of “personal struggle” and financial hardship to pressure a charity into making a payment without carrying out the usual checks.
Fraud can be defended against with the correct financial controls, however. According to the regulator, two thirds of frauds are picked up by financial controls or audits, meaning simple checks and controls, together with a strong counter-fraud culture, can be “key to disarming fraudsters”.
Speaking at the 2020 Charity Fraud Awareness event, Helen Stephenson, Chief Executive of the Charity Commission, said: “We are seeing evidence that opportunists may be taking advantage of charities during the pandemic and I urge all charities to be extra vigilant against fraud.
“This comes at a time when charities are a lifeline for many people suffering from Covid-19, and the wider impacts of the pandemic – charities have been at the forefront of responding to the crisis, and many have also been placed under severe financial strain. As our country faces another challenging point in the crisis, we cannot afford for charitable work to be disrupted by criminals.
“When fraud hits charities, its impact is felt far beyond the balance sheet – it is people that are let down, often hard-working volunteers or people in desperate need. That’s why I’m urging all trustees to take action now, to protect their charity’s valuable funds and assets.”
For support and advice strengthening your financial controls, please get in touch with our expert team today.

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HM Revenue & Customs confirms first arrest in connection with furlough fraud

admin — Thu, 16 Jul 2020 10:07:23 +0000

HM Revenue & Customs (HMRC) has revealed that a 57-year-old man from Solihull in the West Midlands was arrested on 8 July on suspicion of a £495,000 furlough fraud relating to claims from the Coronavirus Job Retention Scheme (CJRS).
HMRC says he is the first person to have been arrested in connection with fraudulent claims from the scheme.
As of 12 July, more than £28.7 billion had been claimed from the scheme by 1.2 million employers in respect of 9.4 million jobs.
HMRC says that the CJRS has four lines of defence against fraud, which it describes as:

Employees have to have been on a payroll on or before 19 March – preventing the use of fake employees
Claims are only accepted from employers known – and authenticated – by HMRC
All claims are assessed by a specialist team within a 72-hour window
Proportionate and reasonable interventions with customers after money has been paid.

Richard Las, the Acting Director at HMRC’s Fraud Investigation Service, said: “The CJRS is part of the collective national effort to protect jobs. The vast majority of employers will have used the CJRS responsibly, but we will not hesitate to act on reports of abuse of the scheme.
“This is taxpayers’ money and any claim that proves to be fraudulent limits our ability to support people and deprives public services of essential funding.”
He called on people to report suspected furlough fraud via HMRC’s online fraud reporting page here.

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Businesses bombarded by cyber-attacks as they seek support for COVID-19

admin — Mon, 27 Apr 2020 12:05:47 +0000

A range of organisations, including the Institute of Chartered Accountants in England and Wales (ICAEW), have released fresh warnings about the risk of cyber-attacks during this already challenging period.
Reports are being released that suggest that cybercriminals are targeting businesses via the use of phishing emails that seem to be from HMRevenue &Customs (HMRC) offering support to businesses.
According to the ICAEW, one such email, proclaiming to be from HMRC chief executive, Jim Harra read: “Dear customer, we wrote to you last week to help you prepare to make a claim through the Coronavirus Job Retention Scheme. We are now writing to tell you how to access the COVID-19 relief.
“You will need to tell us which UK bank account you want the grant to be paid into, in order to ensure funds are paid as quickly as possible to you.”
The rise in fraud and scams as a result of COVID-19 has been dramatic. The National Cyber Security Centre (NCSC) is understood to have already removed more than 2,000 online coronavirus scams over the last month, including 471 fake online shops selling fraudulent coronavirus-related items, 555 malware distribution sites set up to inflict significant damage to visitors and 832 advance-fee frauds.
Fraud is of considerable concern to HMRC and it has asked that people forward suspicious emails claiming to be from HMRC to phishing@hmrc.go.uk or by texting 60599.

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Government updates guidance on small business and retail sector grant schemes

admin — Thu, 02 Apr 2020 11:06:41 +0000

We will shortly be sending out details of how you can apply for these grants with links to the local authorities in this area.

The Government has published new guidance for local authorities on the small business and retail sector grant schemes.
These are one of several measures introduced by the Government to help businesses that are most at risk of failure due to the actions taken to prevent the spread of the Coronavirus.
As previously discussed in our other updates, the Government has created two separate schemes the Small Business Grants Fund (SBGF) and the Retail, Hospitality and Leisure Grant Fund (RHLGF), which are now beginning to be delivered by local authorities.
The latest guidance states: “These grant schemes will offer a lifeline to businesses who are struggling to survive due to the Coronavirus shutdown. Local authorities should make payments as quickly as possible to support struggling businesses.”
The Small Business Grants Fund (SBGF)
All businesses in England in receipt of either small business rates relief (SBRR) or rural rates relief (RRR) in the business rates system will be eligible for a grant of £10,000.
Hereditaments included in this scheme are those which on the 11 March 2020 were eligible for relief, including those with a rateable value between £12,000 and £15,000 which usually receive tapered relief.
The Retail, Hospitality and Leisure Grant Fund (RHLGF)
Businesses in England that would have received the expanded retail discount on 11 March with a rateable value of less than £51,000 are eligible for cash grants for each property they own and operate from.
Those with a property that has a rateable value of up to £15,000 will receive a grant of £10,000, while those with a property that has a rateable value of between £15,000 and £51,000 will receive a grant of £25,000. Businesses with a rateable value over £51,000 are not eligible.
Charities
Charities that otherwise would meet the necessary criteria but whose bill for 11 March was reduced to nil by a local discretionary award are still eligible for the RHLG, according to the guidance.
Exclusions
Hereditaments that are occupied for personal use, such as private stables, beach huts, moorings, car parks and parking spaces are excluded from both schemes.
Additionally, businesses that were in liquation or were dissolved as of the 11 March cannot apply for either scheme.
Applications
Neither scheme has a mandatory application process. Instead, businesses should be contacted by their local authorities who will outline how they can claim a grant.
In some cases, where a business has an existing direct debit to pay business rates, local authorities can handle the application automatically or they may request additional details via an online form.
Fraud
The guidance from the Government makes it clear that these schemes are open to a risk of ‘deliberate manipulation and fraud’. As such, any business caught falsifying their records to gain additional grant money will be prosecuted and the funding provided will be reclaimed.
To assist local authorities, the Government Grants Management Function and Counter Fraud Function has made their digital assurance tool, Spotlight, available to councils to help prevent fraudulent claims.
Payments
The Government confirmed in its latest daily briefing that payments of grants would begin now and that some firms have already received funding automatically from their local authority.
It is recommended that you check your accounts to ensure the money has been deposited if you are expecting payments to be paid automatically.
If you have not been contacted by your local authority and believe you are eligible, we recommend that you speak to the relevant officer at your council to find out how the funding is being delivered in your area.

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