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According to British Train Operating Companies (TOCs), it is estimated that 10-30 percent of compensation claims paid out by the rail sector are fraudulent. Intelligencia Training, who specialise in Counter Fraud Investigation training, explore just how common rail fraud is in the UK.
Rail travel is in high demand in the UK with almost 2 billion passenger journeys each year, but with punctuality for TOCs averaging 92.7-93 percent on-time, fraudsters are taking advantage of the rail sectors compensation system through lucrative schemes.
TOCs are beginning to crack down on fraudulent compensation claims and successful investigations continue to highlight just how big of a financial impact those cheating the system have. In 2020, one serial fraudster was sentenced to jail time after fraudulently claiming £40,000 from TOCs over a period of 5 years. Fraud Investigators found that the man had used the compensation system to claim for delayed journeys that he had never been on. The sophisticated scheme involved the production of hundreds of fake tickets and false claims across 9 companies totalling a staggering £130,000.
Fraudulent compensation claims are not the only ticket fraud scheme impacting the rail sector. In 2021, the British Transport Police reported in an article that a fraudster had made more that £29,000 over a 5-month period through the sale of fake train tickets. The fraudster was eventually caught after LNER received a tip off and the British Transport Police launched an investigation. The scheme would have led to a potential loss to LNER of £263,840.
In a rarer case, one investigation highlighted how the rail sector not only faces threats externally, but also internally. In a 2017 British Transport Police investigation, four rail sector employees were sentenced following a £5 million fraud scheme. The investigation into corruption, fraud, and money laundering found that the employees made corrupt payments to secure a contract and after being appointed, made a series of ‘ghost worker’ claims.
These cases are just a handful of successful investigations by TOCs, but as external and internal fraud threats rise, many rail fraudsters go undetected. Virgin Trains report that they receive almost half a million compensation claims for late or disrupted services each year. For TOCs to improve their ability to identify and investigate fraud, parity of skills across the rail sector is key.
Intelligencia Training supports Fraud Investigators working across a multitude of private and public sectors. The training providers Counter Fraud Investigator Apprenticeship Standard has allowed for parity across sectors and comprehensive development of all knowledge, skills and behaviours associated with being an effective and competent investigation professional.
In a new video case study, a number of Intelligencia Training’s Counter Fraud Investigator apprentices spoke about their experience on their apprenticeship and how it has added value to both themselves and their organisation.
To find out more about the Level 4 Counter Fraud Investigator Apprenticeship Standard, visit www.intelligenciatraining.com/counter-fraud-investigator or contact email@example.com.