Reducing Fraud in the Education Sector

As Amy Ennis, Senior Manager in the Education Team at Forrester Boyd, explains: “We see many education providers doing fantastic work for their communities, but unfortunately this also makes them a target for fraudsters. Prevention, vigilance and a strong organisational culture are the best defences.”

Fraud can take many forms, from theft and false invoicing to more sophisticated schemes such as credit card and mandate fraud. In some cases, it involves the deliberate supply of false information. While the tactics may vary, the intent is always the same: to deceive for personal or organisational gain.

Cybercrime has also added a new dimension to fraud risk. With schools and training providers relying more heavily on digital systems, the threat of phishing attacks, data breaches and ransomware is growing. It is therefore critical that you not only focus on financial controls but also ensure they meet basic cyber security standards and keep them under regular review.

Managing fraud effectively starts with understanding where your vulnerabilities lie. This means taking the time to review systems, test internal controls and evaluate how your teams would respond if a fraud were attempted or discovered.

While some risks are sector-wide, others may be specific to your structure or size. A fraud risk strategy should not be a box-ticking exercise; it must reflect your reality. The most successful plans are those that assess vulnerability honestly, set clear responsibilities, and provide a framework for both prevention and swift response.

At a strategic level, building an anti-fraud culture is as important as any control or policy. Staff need to feel confident that fraud is taken seriously, and that ethical behaviour is not just expected but actively supported. This means encouraging open conversations, ensuring leaders set the tone, and training staff regularly to spot warning signs and know how to report concerns.

Amy adds: “Creating a culture that actively discourages fraud is more powerful than any document. Policies are essential, but values and behaviours make the difference when it comes to early detection and staff engagement.”

As we are very well aware, no system is infallible, which is why having a clear and proportionate fraud response plan is essential. This should include a policy statement that sets out your stance, a defined process for investigation, and clarity over who is responsible for managing and reporting fraud.

A rapid and structured response can limit the impact of fraud, maintain public trust and demonstrate to both staff and regulators that you take risk seriously. This also includes establishing channels for whistleblowing, ensuring your internal audit team has fraud expertise, and seeking specialist advice when and where it is needed.

Crucially, you should not wait for an incident to learn. Evaluating the effectiveness of anti-fraud measures should be a regular activity, using tools such as internal audit, stewardship reporting and risk self-assessments. This not only strengthens your controls but helps develop a culture of continual improvement.

Whilst fraud may be difficult to predict, it is not impossible to prevent. Education providers have a duty to protect public funds, staff and students. This means recognising fraud as an operational risk, embedding ethical standards at all levels, and staying ahead of emerging threats - particularly in the digital space.

Amy concludes: “In today’s environment, schools and colleges can’t afford to be reactive. With the right strategy and mindset, they can significantly reduce their exposure to fraud and safeguard the resources that matter most.”

At Forrester Boyd, we support education providers in assessing and strengthening their fraud prevention frameworks. If your organisation would benefit from a review or support with policy development, our team is here to help.