The rise of fraud in New Zealand

by Julie Haggie
Chief Executive Officer
Transpanency Interntional New Zealand

The latest results from the Ministry of Justice New Zealand Crime and Victims Survey reflect what is already known and experienced across New Zealand: there has been a sharp increase in fraud and deception crime in New Zealand, doubling in one year, whilst overall levels of crime in the community remain relatively stable.

10.2% of New Zealand adults surveyed reported having been the victim of at least one fraud and deception event between Nov 2021 and Nov 2022, compared with 6.2% in 2021. Of all personal offences, fraud and deception had the highest prevalence (experienced by 423,000 adults), followed by harassment and threatening behaviour (experienced by 120,000 adults). Sadly 55,000 people reporting as fraud or deception victims were repeat victims.

This survey is important because it is well documented that many experiences of fraud are not reported to justice authorities at the same rate as other types of crime. Reasons include the size of loss, shame, and people reporting to their banks not government agencies.

The survey raises a lot of questions that public sector agencies should have the answers to, to support prevention and detection. :

  • What are the causes of this rapid spike?
  • What is the typology for the increase, i.e types of fraud that people are experiencing, where the fraudsters are based, what modes are they using for different types?
  • Do we know enough about victims to target support and prevention resources?
  • Do we have the right monitoring and recording; are we keeping up with digital criminal methods? Are regulators watching and sharing trends with banks and other agencies?
  • Is white collar and business fraud also on the increase?
  • Is this pattern being repeated overseas; is there comparable international data?
  • Have the COVID pandemic and subsequent economic recession had a specific influence?
  • Where are the gaps in prevention, prosecution and victim support?
  • Are we falling behind in consumer protection from scammers?

It is vital that victims are not under-served by insufficient knowledge, delay, speculation, passing the buck or ‘prioritisation’.

It is difficult to compare New Zealand’s performance with other countries, as victim surveys are not undertaken regularly around the world and do not always measure the same periods or things.

The Australian Bureau of Statistics collects and reports on information informed by an annual fraud survey. The latest ABS statistics show that card fraud rose to 8.1% in 2021/22, scam victimisation reduced during that period to 2.7%, and online impersonation was experienced by 2.5%.

The UK’s latest Crime Survey shows that total fraud has now returned to pre-coronavirus pandemic levels following a significant spike during the COVID period.

It is clear that personal fraud is not being managed well enough to protect consumers in New Zealand, and that criminals are exploiting the gaps.

The Independent Police Complaints Authority report published in November 2022 found major deficiencies in the way in which Police are responding to fraud complaints and large gaps. It also recommended Police leadership of a fraud prevention strategy incorporating both public and private sector agencies.

The Banking Ombudsman is urging New Zealand’s banks to fast-track resolution of fraud complaints, and for banks, regulators, telecommunications firms and government ministries to work together to combat sophisticated online fraud.

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