A report by the fraud prevention service Cifas, released in conjunction with WPI Economics, showed one in seven (14 per cent) British adults have committed one or more types of consumer fraud, while two in three (66 per cent) know someone who has.

All types of fraud are estimated to cost the UK economy about £190bn, according to Cifas figures. Younger people more likely to carry out fraud, with one in five (21 per cent) of those aged 18 to 34 saying they have committed at least one form of first party fraud, compared to only 6 per cent of people aged over 65.

Types of first-party fraud

Fronting is the most common type of first-party fraud. It usually involves parents taking out a car insurance policy in their name, with their child as a named driver, despite the fact the child will be driving the car more often.

Families can save hundreds of pounds on insurance this way but fronting is illegal and could invalidate your car insurance.

Another common fraud is “deshopping” – buying items, usually clothing, with the intention of using/wearing them before returning to the store for a full refund. One in 20 (5 per cent) of people admit to doing this.

Other first party frauds highlighted by the Cifas report include falsely claiming non-delivery of goods in order to get a refund, and money muling whereby someone agrees to transfer illegal funds to a third-party from their bank account, in return for a fee.

Attitudes towards first party fraud

Cifas found four in 10 (39 per cent) Brits regard fronting as “reasonable”, with 6 per cent admitting to having done it. However, the consequences of committing this type of fraud could see individuals driving without valid insurance, and in some cases, getting a criminal record.

Interestingly, “money muling” is considered reasonable by one in five (22 per cent) Brits, despite the potential consequences of being blacklisted by banks and mortgage lenders, or a possible prison sentence.

Mike Haley, chief executive officer of Cifas, said: “It’s sad to note how common fraud is among the British population, and that even more people find such acts of dishonesty acceptable.

“Many people seem unaware that what they consider to be reasonable, such as buying shoes to wear for a night before returning them, or adding their parent as a main driver for cheaper insurance, can be considered acts of fraud.

“We wanted to raise awareness of the consequences what can be considered everyday fraud, such as finding it difficult to obtain a financial product or a mobile phone account, and in some cases such as being a money mule, end up with a criminal record.”