With criminals becoming increasingly sophisticated, the Charity Commission is urging charity trustees to help their organisations stay safe from fraud.
The Commission says that they are seeing an increase in fraudsters using emails, texts, phone calls and online platforms to deceive trustees into sharing personal information or making payments. It warns that trustees (and members of staff) may be personally at risk from such attempts.
Advice on avoiding fraud includes reviewing privacy settings, thinking about what identifiable information trustees share online (such as email addresses), and using strong, unique passwords for every account. Also important are keeping software updated, and being wary of suspicious links, attachments or phone calls.
Charities can be defrauded in all sorts of ways, which may be connected with fundraising, banking, tax and Gift Aid, property and investments. Fraud can come from both internal and external sources.
In its guidance on protecting charities from fraud, the Charity Commission urges trustees to ensure that there is strong financial management and governance, understand the risks, and to promote a culture of fraud awareness amongst staff and trustees. It also gives advice on what action to take if a trustee or the charity is a victim of fraud, or suspects they may have been targeted.
All charities should have an anti-fraud policy which they promote to everyone involved with the charity, and they should review fraud risks on at least an annual basis. Larger charities are obliged to report fraud risks and how they are managed in their annual report.
Charities should also ensure they have the relevant insurance in place to cover themselves against fraud – including cyber-attacks.
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- The full Charity Commission guidance on protecting your charity from fraud can be found here.
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- The Preventing Charity Fraud website has some useful resources on preventing, detecting and responding to fraud.