Fraud epidemic costs Britain £220 billion annually, nearly as much as annual health spending

Fraud costs the UK economy an estimated £220 billion annually, according to Crowe’s latest Annual Fraud Indicator report, conducted in partnership with the University of Portsmouth and Cifas, the UK’s fraud protection service.

The report shows how hidden and undetected fraud continues to significantly impact organisations across the UK, highlighting the growing threat posed by increasingly sophisticated fraud techniques. Read the full report here.

Key findings include:

• Fraud cost the UK economy an estimated £220 billion in 2024-25. This makes fraud one of the UK’s most significant economic challenges. To put that figure into perspective: 
  • The UK’s entire health and social care budget for 2026: £242 billion
  • UK national deficit for 2026 YTD August: £51.9 billion
  • £220 billion a year is: £600 million a day; £25 million an hour; £7,000 a second
• The private sector accounts for £168bn (76%) of all losses, while fraud against the public sector totals £49bn annually. Businesses therefore bear more than three-quarters of the UK’s estimated fraud losses.
   
• Procurement fraud represents the largest fraud category, costing UK organisations more than £153bn a year. Stronger oversight of suppliers, contracts and purchasing processes will be critical to reducing exposure.
   
• Tax fraud costs the UK Government £18.2bn annually. This diverts substantial public resources away from other priorities.
   
• Universal Credit fraud accounts for £5.2bn of losses each year. This forms a significant part of the fraud losses borne by the public sector.
   
• Counterfeit goods cost UK businesses £9.8bn annually. This highlights the growing impact of counterfeit goods on private-sector losses.

Procurement fraud emerges as the UK's largest fraud risk

Costing UK organisations more than £153bn annually, procurement fraud is the single largest source of fraud losses identified in the report. Despite often receiving less attention than cybercrime or consumer scams, procurement fraud continues to pose a significant threat across both the public and private sectors.

As organisations face increasing financial pressures, strengthening oversight of supplier relationships, contracts and purchasing processes will be critical to reducing exposure to fraud.

Hidden fraud remains the greatest threat to organisations

While headline-grabbing fraud cases often attract public attention, a significant proportion of fraud remains undiscovered and unreported. The report suggests that hidden fraud accounts for a substantial share of total losses, with many schemes remaining undetected for years. As a result, organisations may be significantly underestimating their exposure to fraud risks, particularly in areas where routine controls fail to identify suspicious activity. Beyond the initial financial loss, fraud can also lead to operational disruption, reputational damage and costly investigations.

Private sector bears biggest share of fraud losses

The private sector accounts for an estimated £168bn of fraud losses annually, representing more than three-quarters (76%) of all fraud identified in the report. As the largest part of the UK economy, businesses face fraud risks across a wide range of activities, from procurement and payroll to counterfeit goods, refund fraud and insurance claims.

The report attributes a significant proportion of these losses to procurement and payroll fraud, reflecting the vast levels of spending that take place across UK businesses each year. New categories included in this year's analysis also highlight the growing impact of counterfeit goods, estimated to cost UK businesses £9.8bn annually, alongside losses arising from food fraud and online refund fraud.

As fraudsters continue to exploit both traditional business processes and emerging technologies, the findings suggest that organisations should treat fraud as a core business risk and ensure adequate investment in prevention, detection and staff awareness.

Tim Robinson, Partner Cyber Security and Counter Fraud at Crowe, comments: “You can't tackle fraud effectively without understanding its true scale. Too often, under-reporting and under-detection mean organisations are only seeing part of the picture.

“The scale of the issue can be hard to grasp. Eradicating fraud entirely would be enough to plug the national deficit four times over. This shows just how impactful counter-fraud measures could be in transforming the economic picture for the UK.

“At an estimated £220 billion a year, fraud remains the UK's most common crime and one of its most significant economic challenges. At the same time, AI-generated scams, synthetic identities and deepfakes are making fraud harder to detect and easier for criminals to carry out.

“Organisations need to ensure they are investing in the right controls, technology and staff awareness to keep pace with an increasingly sophisticated threat landscape.”

Martin Chapman, Partner and Head of Forensic Disputes and Investigations at Crowe, comments: “For many organisations, the greatest fraud risk is the fraud they don't know about. While high-profile cases often attract attention, a significant proportion of fraud remains hidden, undiscovered and unreported for years.

“The immediate financial loss is often only the starting point. Fraud can trigger lengthy investigations, regulatory scrutiny, operational disruption and reputational damage, with the impact felt by employees, customers and shareholders alike.

“These losses are not merely numbers on a balance sheet. They represent resources diverted away from investment, innovation and growth, while trust, once lost, can be difficult and expensive to rebuild.”

Daniel Sibthorpe, Director Cyber Security and Counter Fraud at Crowe, comments: “Fraud is fundamentally built on deception and concealment. Criminals go to great lengths to ensure their activities remain undetected, which means much of the harm they cause is never reported or fully understood. The Annual Fraud Indicator shines a light on this hidden reality, providing a clearer picture of the threat facing individuals, businesses and the public sector alike.”

Mike Haley, CEO of Cifas, said: “The scale of these losses demonstrates that fraud needs to remain a national priority. Every pound lost to criminal activity is money that cannot be invested in economic growth, public services, innovation or supporting customers.

“The latest Annual Fraud Indicator report shows fraud is often hidden, underreported and underestimated. This makes cross-sector data and intelligence sharing and collaboration between organisations, law enforcement, regulators and Government agencies more important than ever. By working together to identify threats at the earliest opportunity, sharing insight and preventing fraud before it occurs, we can reduce the harm it causes.”

Professor Mark Button, Co-Director of the Centre for Cybercrime and Economic Crime at the University of Portsmouth, added: “Fraud is often discussed in terms of individual cases and incidents, but the findings in this report underpin into the significant challenge facing the UK as a whole.

“Fraud is not a minor problem, and it is not victimless. It is a crime that must be recognised as a major threat affecting every part of the economy and addressed through a coordinated and effective nationwide response.”

ENDS

Notes to Editors

For more information, contact Marie Fryatt, PR Manager, Crowe UK, on 020 3457 6671 or marie.fryatt@crowe.co.uk; and/or Matthew Gilleard/Charlotte McCluskey, Infinite, on 020 7269 1430, crowe@infiniteglobal.com

Methodology 

The Annual Fraud Indicator 2026 was produced by the University of Portsmouth in partnership with Crowe and Cifas. The report combines official economic data with fraud loss measurement exercises and published fraud estimates to assess the annual cost of fraud across the UK economy. This year's report also introduces a number of methodological improvements aimed at increasing transparency and robustness.

About Crowe

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