Coping with fraud
The authorities are not visible enough to Scottish SMEs when it comes to dealing with the fall-out of fraud
A large percentage of Scotland’s small and medium-sized enterprises do not know who the relevant authorities are to help them deal with fraud, new research from Braemar Finance’s parent company, Close Brothers, has revealed.
In response to the Business Barometer survey, 65 per cent answered ‘no’ to the question ‘Do you know who the relevant authorities are to help you deal with fraud?’; this compares to 58 per cent for the UK as a whole.
“Fraud can take many different forms, making it critical that business owners know who the relevant authorities are, even if they haven’t been directly targeted,” said Aileen Boyle, managing director of Braemar Finance.
“Much of today’s fraud is driven by an increase in cybercrime, highlighting the importance of having the correct online checks and balances in place.”
Fraud and legal advice
The same percentage of Scottish SMEs – 8 per cent – have both been a victim of fraud and had to seek legal advice.
“It’s reassuring that business owners are contacting their legal representatives because being a victim of fraud can have a range of impacts, from loss of trust and reputational damage all the way through to business failure and jail terms for those involved,” said Aileen.
“The figures confirm that no-one is immune and it happens in all walks of life, across all industries and in businesses of every size.”
Insurance against fraud
Only 37 per cent of businesses are certain they are covered in the event of fraud, with 35 per cent answering ‘no’ to the question ‘is your business insured against fraud?’; the remaining 28 per cent ‘don’t know’.
“If you don’t know, then it’s worth checking your insurance policies to see whether you are insured against fraud, theft or dishonesty,”
“This could be via a stand-alone policy or as part of an insurance product like home contents, travel, or legal expenses.
“According to the Fraud Advisory Panel, it’s also possible to sometimes buy ‘after the event’ insurance after fraud has taken place to help fund the costs of civil litigation.
“These policies provide insurance against the cost of trying to recover those losses through legal proceedings.”
Aileen Boyle is the MD of Braemar Finance, where she and the team have spent the past 20 years establishing the company as one of the main providers of finance for the professions in the UK. Contact Braemar Finance on 01563 852 100 to speak to a representative about your finance needs.