The public sector is leading the way when it comes to putting counter-fraud strategies in place while the private and voluntary sectors lag behind, say the authors of a new report.
While 93% of public sector organisations have policy in place to deal with fraud and corruption, by contrast only 75% in the private sector and 54% in the third sector do so.
A survey of 376 organisations across the public, private and voluntary sectors, also found the public sector was ahead on fraud detection with more than 80% of respondents saying they had formal policies in place compared to 58% and 45% in the private and voluntary sectors respectively.
Almost all of the public sector organisations surveyed also had reporting systems in place for suspected cases of fraud and corruption, with the voluntary sector coming bottom.
Jim Gee, author of the report and former chief executive of the NHS counter fraud service, a director of PKF and chair of CCSF, criticised the lack of counter-fraud work in the voluntary sector.
"In a previous era when charities were not held accountable to the public, this lack of resilience may have been acceptable," he said. "However, with greater pressure on the voluntary sector to step in where the public sector will have to draw back, charities have to protect themselves. This research shows that they are vulnerable to fraud."
While Gee acknowledged fraud was only carried out by "a dishonest minority" he said the sector couldn't afford to be complacent in moving toward 'big society'.
"Organisations need to shift their thinking so that counter-fraud work gets incorporated into mainstream operational activity," he said.
The report looks at both internal and external fraud, which the authors said varied between organisations; while the Department for Work and Pensions dealt mainly with external issues such as benefit fraud, local authorities were more likely to look at internal processes such as payroll and procurement.
Although public sector fraud is generally perceived to be mostly external, error and internal fraud are also major issues.
Graham Kemp at business intelligence firm, SAS UK, said many civil servants believed internal fraud to be the biggest threat to the appropriate distribution of funds.
Last year a PricewaterhouseCoopers report said internal fraud in the public sector accounted for 39% of fraud cases and said the figure was likely to rise under current financial pressures. It added that around a third of fraud cases were detected by internal tip offs, while the majority of those in the private sector were from internal audit and risk management.
The resilience report found that compared to other sectors, however, the public sector was more thorough in screening prospective staff and putting policies in place to recover losses, including the use of legal measures. It was also more likely to review the effectiveness of anti-fraud policies.
Although the private sector tended to use profit loss estimates to inform the level of investment in counter-fraud work, the public sector more often provided specialist training for employeers to counter fraud, the report found.
Mark Button, CCSF director, said: "Organisations need to understand where they are exposing themselves to risk and respond effectively. The honest majority have a right to know how well organisations they rely on are protected against the dishonest minority who would defraud them."