- Some 40% of South Africans surveyed by a global data analytics firm see nothing wrong with lying about their income or insurance claims.
- The willingness to exaggerate income when applying for a cell phone contract is more common.
- Many of those surveyed also see nothing wrong with inflating property value in an insurance claim.
- Lying about income to obtain credit or a contract is fraud, as is inflating insurance claims.
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Some 40% of South Africans find it acceptable to exaggerate income on credit applications and inflate insurance claims, according to a new survey by global data analytics firm FICO.
Many South Africans see no problem in committing fraud first hand by lying about their income when applying for loans, cell phone contracts, car financing or a mortgage. The same can be said for overstating the value of property on an insurance claim and even, albeit to a lesser extent, adding items to said claim that were not lost, stolen or damaged.
“Many South Africans are experiencing a rising cost of living and may find they can alleviate their circumstances by falsifying information on credit applications,” said Michelle Beetar, who heads FICO’s operations in Africa. The credit-focused data analytics company surveyed 1,000 South African adults in August and the results of the study were published on Monday.
“However, this misrepresentation is a fraud.”
First party fraud is considered acceptable by many (FICO)
More than 45% of FICO respondents found it acceptable, and in some cases normal, to exaggerate their income when applying for a cell phone, making it the most significant case of willful fraud discovered by the study.
Thinking little wrong about exaggerating income when applying for a bank account and vehicle financing were the second and third most common instances of misrepresentation, respectively, both exceeding 40%.
South Africans surveyed were more wary of adding items to an insurance claim that were not, in fact, lost, stolen or damaged, with fewer than 25% saying they would commit fraud firsthand in this case. Nearly 40% of those surveyed said they saw no problem with inflating property value in an insurance claim.
“Financial institutions that can spot anomalies that suggest information is being exaggerated or misrepresented can take positive steps to protect themselves from losses that would occur when the customer is unable to pay refunds, and the customer can be prevented from going down a path in the I’ll end up regretting it,” Beetar added.