Charities are getting better at avoiding losing out financially when targeted by fraudsters, a survey has found.

While last year more than nine in ten charities lost money from fraud in 2023, this has reduced to just over one in eight this year.

As with last year just over two in five charities are reporting fraud or attempted fraud, but the number of incidents at each has reduced, from five to eight on average in 2023 to four to seven in 2024.

Despite this improvement the charity sector continues to suffer significant losses, of between £5.9m and £11.4m in 2024. The average loss per fraud is £102,000 and £197,000 and only two in five can recover losses.

Fraud by trustees, staff, volunteers and others with a connection to the charity has remained the same between 2023 and this year, accounting for half of incidents. This includes payroll, expenses and procurement fraud.

However, fraud by those with no connection to the charity, including criminal gangs, has increased. Three in ten charity fraud incidents are from those not involved in the charity, compared to just over two in ten last year.

This suggests criminals are increasingly targeting charities.

The findings have emerged in this year’s charity fraud survey, published by consultancy BDO and the charity Fraud Advisory Panel.

It has been released to coincide with Charity Fraud Awareness Week (November 25-29).

This also found that more charities are reporting fraud incidents to police. More than half reported attacks this year, compared to under two in five last year.

More charities are also taking disciplinary action, up from just over a third in 2023 to just under a half this year.

While a fifth of charities took no action at all after an incident, this has reduced to around one in eight this year.

The report also indicates that the cost-of-living crises has had an impact on charities’ ability to invest in fraud prevention.

The proportion that do not invest in fraud doubled from in ten last year to just under one in five this year.

Two in five charities do not have key policies in place to tackle fraud, such as procedures to tackle conflict of interest and promote whistleblowing.

Meanwhile, three in five believe that the cost-of-living crisis has heightened the risk charities face from fraudsters in 2025.

“Despite operating in a continually challenging fraud environment, our 2024 survey reveals a real sense of development and growth in how charities manage fraud risk, from a positive stance when dealing with instances of fraud to an optimistic outlook when developing prevention strategies,” said BDO and Fraud Advisory Panel’s report.

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