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Fraud in Asset Finance

As we approach Halloween it’s not vampires or witches that are scaring business owners. Instead it’s fraudsters that are giving everyone the jitters. The 2017 CIFAS Fraudscape report identified that fraudulent crimes in asset finance increased by 22% in 2016 compared to the previous year. Asset finance fraud can be particularly unnerving as the threat can come from several directions.

There are four main sources:

Identity Fraud –  Identity related crimes happen when a fraudster has abused identity details to commit fraud. Within Asset Finance there was an 88% increase in identity fraud from 2015 to 2016. This was largely due to a high number of current address impersonations.

Application Fraud – Where an applicant has used their own name but has submitted an application which contains false information. For example, an individual provides a false address to make it appear their equipment will be located in an area with lower crime statistics.

Asset Conversion Fraud –  The sale of an asset that is subject to a credit agreement.  Where a business sells a good (such as equipment) that they do not have title to.

Misuse of Facility Fraud – Where an individual obtains an account/policy or other facility with the intent of using that facility for a fraudulent purpose.

EquipmentConnect have partnered with Innovate UK and blk.io to help prevent asset finance fraud. In a later post, we will discuss how we will use blockchain tech to improve cybersecurity and prevent fraud.

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