Who will experience fraud in France in 2022?

According to the data provided by the Allianz Trade study, 69% of French companies report having suffered at least one fraud attempt in 2022 and 57% report having experienced actual fraud. But let's go into more detail in order to have all the cards in our hand.

‍Fraud in banking, loan institutions, payment services and factoring

Fraud is a phenomenon that affects many industries.

In the financial sector, there are no less than 100 different forms of fraud according to the Ministry of Economy and Finance. Document fraud is the main form of fraud in banks, loan institutions and factoring services.

These forged documents are used to obtain loan, open false accounts, finance false invoices, launder money or, in the most extreme cases, to finance terrorism. In these different cases, it is important for banks to protect themselves against these frauds.

In the case of factoring, the verification of invoices is necessary in order to avoid committing to documents that would be fraudulent and thus lead to unpaid invoices. The company Urica for example, went out of business because of false invoices.

🎁 Bonus: To find out more about this case, read our article on Urica fraud available here!.

Bank fraud amounts to 1.24 billion euros in France in 2021. Check is one of the easiest ways to commit fraud today, even if the volume has been decreasing since Covid 19. It is therefore estimated that bank fraud represents more than 3% of all fraud in France.

If bank fraud is important in France, insurance fraud is not negligible. In 2021, one person out of 5 claims to have already committed insurance fraud. This figure is constantly evolving, especially since the digitalization of all insurance files.

To get an overview of existing fake documents, read our corresponding article: what are the different types of false documents?

Insurance fraud

Six categories of insurance fraud have been identified in France:

• compensation fraud
• insurance premium fraud
• claims fraud
• fraud in non-payment of premiums
• fraud involving non-compliance of policy clauses
• damage fraud.

Explanation of the main frauds:

Compensation fraud in the insurance industry refers to any deliberate attempt or intentional act to obtain compensation in violation of the insurance contract. Compensation fraud is a crime that is considered a breach of trust against the insurance company involved.
‍Example : water damage occurs in my house, only my TV cabinet and ceiling are damaged. However, in order to get a higher compensation, I will amend the invoice for my TV cabinet as well as the repair invoice for the ceiling by inflating the figures. This is a very simple procedure but creates a shortfall in the insurance company's revenue.

Insurance premium fraud involves taking out insurance policies to collect premiums that should not be due.
‍Example : I have a lot of claims on my car, I have a large malus, however, I will change my certificate and take out a new insurance policy so that I can get bonuses and not bear the burden of my malus.

Claims fraud is faking a claim to obtain compensation for an accident or death.
‍Example : I report a claim and falsify an invoice that I send to my insurance company to obtain compensation even though the claim never happened.

All of these frauds involve the transit of documents, documents that may have been falsified in order to carry out these frauds. It is essential for insurance companies to verify the veracity of the documents provided. These frauds cause considerable losses today: between 5 and 10% of insurance turnover.

Fraud in real estate

Fraud in real estate is on the increase. In 2020, 11% of the files contained a falsified document against 20% in 2021.
The real estate fraud concerns in particular the landlords and the real estate agencies.

It is considered that 20% of the tenants' files contain a forged document in France in 2022. This sometimes leads to unpleasant surprises for landlords with tenants who are not able to pay their rent. As insurance for unpaid rent is only available for students, some landlords find themselves without any payment from their tenants and find it difficult to make them leave. Indeed, the eviction procedure is long (between 18 and 24 months) and costly. During this period, no money is coming in, however, the landlord must continue to pay: utilities, loans etc.

The loss of income can therefore be considerable for the landlords. It is therefore essential to verify the authenticity of the documents in order to ensure that tenants are solvent.

Fraud in all sectors

More generally, fraud exists in many sectors. To find out more about the different types of fraud you can read our explanatory article here. Indeed, fraud represents 42 billion of losses per year, half of which is in the private sector. All companies are affected, whatever the sector or size.

Note : all sectors of activity are now victims of fraud, so it is absolutely essential to know how to protect yourself from fraud and thus avoid losses that could be linked to it.

The Fin’Équipe's advice

It is important to identify all the frauds that the company will and could face.

The better you know the risk, the better you can protect yourself against it. If you want to fight against document fraud, give us a call!