The Growing Threat of Hiring Fraud in the UK: Key insights from our recent webinar

The Scale of the Problem

Simon Fell, Director of Fraud and Financial Crime at Fullbrook Strategies and former government fraud policy lead, painted a stark picture of the current fraud landscape. "We've moved from a world where fraudsters went through bins looking for personal data to one where 85% of fraud is committed online," he explained. "You can now go on the dark web, spend dozens of pounds, get 10,000 email addresses, and only need one person to respond to make your effort worthwhile."

The statistics are sobering: fraud costs the UK hundreds of billions annually, with an estimated 70% originating overseas. This shift from local to global operations has made the UK a "net importer of fraud," creating unprecedented challenges for law enforcement and businesses alike.

The Evolution of Criminal Operations

What's particularly concerning is the evolution from individual opportunistic fraudsters to organised crime gangs operating sophisticated "fraud factories" overseas. These operations aren't just focused on financial fraud – they're connected to drug running, people trafficking, modern slavery, and even terrorist financing.

"These are bad people with fingers in many pies," Fell emphasised. "We need to be able to organise a concerted international effort to go after them."

AI: A Double-Edged Sword in Hiring

Corinne Peart, Director of Client Relationships at Reed Screening, highlighted how artificial intelligence is reshaping both fraud techniques and detection methods. Whilst AI offers benefits and efficiencies, it's increasingly being misused by job applicants to generate applications, case studies, and cover letters.

"We hear almost daily about applicants using AI to generate applications, and then the person who's applied isn't up to scratch or doesn't have the right qualifications," Peart noted. "If you're not careful, you'll find yourself wasting time and money."

The Insider Threat

One of the most alarming trends discussed was the infiltration of legitimate businesses by organised criminal gangs. Fell revealed that criminals are "injecting people into businesses, going through legitimate processes as qualified candidates, but once inside, they can enable data breaches, cause problems, or simply walk away with money."

This insider threat extends beyond direct infiltration to coercion of existing employees, where criminal gangs identify legitimate employees and "lean on them" to harm businesses from within.

The Reference House Phenomenon

Peart shared a particularly striking example of how reference fraud operates through "reference houses" – fraudulent organisations that provide false employment histories and references. In one case, a job seeker who had been repeatedly rejected due to references showing dismissal for theft paid a reference house to provide false documentation. They successfully obtained employment but later stole £80,000 from their new employer.

Reed Screening operates a fraud database containing over 2,000 fraudulent organisations, and they've found that as many as one in four CVs contain falsehoods, misstatements, or outright lies.

Key Warning Signs to Watch For

The webinar highlighted several red flags that organisations should monitor:

In References:

• Unofficial-looking email addresses
• Spelling errors and additional characters
• Questionable referee job titles or positions of responsibility

In CVs and Applications:

• Lack of detail in employment history
• Claims that can't be verified
• Inflated job titles
• Gaps in employment that can't be explained

In Qualifications:

• Digitally edited documents that don't adhere to standard formats
• Entirely fabricated qualifications
• Claims of experience that can't be verified

The Technology Challenge

An interesting dynamic emerged around AI's role in both perpetrating and detecting fraud. As Peart noted, "AI is monitoring AI" in many organisations, with candidates using AI to create applications whilst organisations use AI to screen them – often with no human oversight.

"If you do utilise AI, you need to have a human touch point," Peart advised, highlighting the importance of maintaining human judgement in the screening process.

The Path Forward

The webinar concluded with several key recommendations for organisations:

1. Implement robust screening processes that can't be easily manipulated
2. Use face-to-face interviews where possible, as they're harder to fake
3. Challenge screening providers if they're not thorough enough
4. Stay vigilant for the warning signs of fraud
5. Maintain human oversight even when using AI tools

Government and Industry Response

The discussion also touched on the increasing pressure on social media platforms, particularly Meta, which is responsible for about 70% of fraud seen by the banking sector.

The challenge, as Fell noted, is holding these international platforms accountable whilst navigating complex geopolitical considerations. The approach needs to be measured – "boiling the frog" slowly with reasonable legislation that gradually increases accountability.

Looking Ahead

The webinar made clear that hiring fraud is not a theoretical risk but a present and growing threat to UK businesses. With organised criminal gangs becoming increasingly sophisticated and international in scope, the need for robust vetting and screening processes has never been more critical.

As Peart concluded, "If you don't think that hiring fraud has in some capacity touched your organisation, I would urge you to really look under the hood. I think you'll be surprised."

For organisations serious about protecting themselves against these evolving threats, the message is clear: robust screening isn't just good practice – it's essential for business survival in an increasingly complex fraud landscape.

Join us at the 25th Annual Employee Vetting and Screening Conference on Wednesday 1st October 2025 in London, where leading experts will share the latest best practices for preventing recruitment fraud and ensuring compliant, effective screening processes. With sessions covering everything from AI implementation to legal compliance, this premier industry event is essential for HR, security, and recruitment professionals. Register today and take advantage of 20% off until 31st July with code VETTING20.

This article is based on insights from our recent webinar on employee vetting and screening. For more detailed guidance on tackling hiring fraud, including the UK's first comprehensive guide on the subject, organisations are encouraged to engage with industry experts and implement robust screening processes.