Fraud risk in commercial property
According to the Crime Survey for England and Wales (CSEW) for the year ending March 2025, fraud accounts for 44% of all crime in the UK. The CSEW indicated a 7% increase in headline crime compared to the previous year, driven mainly by a 31% rise in fraud incidents. However, the CSEW estimates that only about one in eight fraud cases are reported to Action Fraud or the police.
One of the key findings of the Association of Certified Fraud Examiners’ 2024 edition of the Report to the Nations is that organisations lose an estimated 5% of their revenue to fraud each year. In today’s difficult economic climate, that 5% could be the difference between sink and swim for many businesses in the UK.
After the financial services sector, the property sector is the most vulnerable to fraud. The large sums of money involved in property transactions make the sector particularly appealing to criminals.
Failing to deal with fraud can lead to dire consequences for individuals and organisations, with punishments ranging from fines to imprisonment, especially given the new ‘failure to prevent fraud’ offence, which came into force on 1 September 2025. There are also serious and wide-ranging financial and reputational implications. That is why it is vital for surveyors to educate themselves about fraud, and to understand the steps they can take to protect their revenue and reputation.
COVID-19 had an unprecedented impact on the commercial property sector, with remote working patterns causing a significant reduction in demand for commercial office space. Given flexible work arrangements and hybrid models are now the new norm, the sector has had to adapt. In addition, rising inflation and the contraction of the UK economy has added fuel to the fire.
Although inflation has been close to the 2% target since the middle of 2024, the rate of inflation rose in 2025, reaching 3.8% in July and August, as a result of, among other things, higher food prices. The RICS UK Commercial Property Monitor, Q2 2025 points to a broadly stagnant backdrop, with headline measures of demand sitting in neutral territory on both occupier and investment sides of the market. While Central London continues to exhibit relatively strong momentum, investment enquiries show little to no growth at national level.
Fraud in the commercial property sector evolves year-on-year, and therefore keeping up to date on evolving trends is important for your own and your organisation’s protection. Through the Economic Crime and Corporate Transparency Act 2023, the UK government has created a corporate offence of failure to prevent fraud. The offence came into force on 1 September 2025 and will apply to all large corporate bodies and partnerships, i.e. organisations that meet two of the following criteria:
- more than 250 employees
- more than £36m turnover or
- more than £18m in total assets across all sectors.
A defence to prosecution mirrors that under the Bribery Act 2010 where an organisation must demonstrate they had reasonable procedures in place to prevent fraud. Government guidance on such reasonable fraud prevention procedures was published on 6 November 2024. It is advisable to review this guidance in order to ensure your organisation implements processes and procedures to prevent fraud so that employees and other stakeholders are aware of what is expected.
This section is maintained by Arun Chauhan and Esther Phillips of Tenet Compliance and Litigation.