Lack of data tools sees public sector failing to recoup fraud losses

Only a fraction of reported fraud is currently being reclaimed across the UK public sector, with some departments recovering less than a quarter (23 percent) of losses, despite employing dedicated counter-fraud teams.

At the same time, thousands of referrals are going un-investigated due to “insufficient data” or lack of capacity.

These are some of the findings from a recent Freedom of Information (FOI) campaign from UK provider of intelligence and investigations software, Blackdot Solutions. The firm contends that the FOI data suggests that with enhanced training and tools, departments could recover more lost funds and better protect taxpayer resources.

As such it is calling for greater investment in open source intelligence (OSINT) – the targeted collection and analysis of publicly available data – to strengthen fraud investigations.

Blackdot says the data points to OSINT training and tool investment being inconsistent, with some authorities relying on general search engines. Fewer than 10 percent of investigators are equipped with specialist tools, raising both efficiency and security concerns.

In some forces, staff trained in OSINT make up less than two percent of the workforce, raising questions about preparedness for increasingly digital-era threats.

The company also says the findings point to a growing disconnect: while fraud is becoming more sophisticated and digital in nature, many public bodies continue to rely on outdated or limited methods to detect and investigate it.

“The public sector has a real opportunity to recover more losses and safeguard taxpayers’ money by adopting modern intelligence techniques,” said Blackdot CEO, Stuart Clarke. “Fraudsters are increasingly using digital tools, and investigators must be equally equipped. Consistent investment in OSINT capabilities will not only improve recovery rates but also strengthen the resilience of public bodies against future threats.”