- Around 40% of South Africans surveyed by a global data analytics company see nothing wrong with lying about their income or insurance claims.
- The willingness to exaggerate income when applying for a cellphone contract is most common.
- Many of those surveyed also see nothing wrong with inflating the value of property in an insurance claim.
- Lying about income to get credit or a contract is fraud, as is inflating insurance claims.
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About 40% of South Africans find it acceptable to exaggerate income on applications for credit and inflate insurance claims, according to a new survey by global data analytics company FICO.
Many South Africans see no problem in committing first-party fraud by lying about their income when applying for loans, cell phone contracts, vehicle finance or a mortgage. The same can be said about exaggerating the value of property in an insurance claim and even, although to a lesser extent, adding items to such a claim that weren’t lost, stolen, or damaged.
“Many South Africans are experiencing a rise in the cost of living and might consider that they can ease their circumstances by falsifying information in applications for credit,” said Michelle Beetar, who heads FICO’s operations in Africa. The credit-focused data analytics company surveyed 1,000 South African adults in August, with the results of the study published on Monday.
“However, this misrepresentation is fraud.”
First-party fraud is considered acceptable by many (FICO)
More than 45% of those surveyed by FICO found it acceptable – and in some cases normal – to exaggerate their income when applying for a cellphone, making it the most significant instance of willing first-party fraud uncovered by the study.
Thinking little wrong with exaggerating income when applying for a bank account and vehicle finance were the second and third most-common cases, respectively, of misrepresentation, both exceeding 40%.
South Africans surveyed were most wary of adding items to an insurance claim that weren’t, in fact, lost, stolen, or damaged, with less than 25% saying they would commit first-party fraud in this instance. Almost 40% of respondents said they saw no problem with inflating the value of property in an insurance claim.
“Financial institutions that can spot anomalies suggesting that information is being exaggerated or misstated can take positive action to protect themselves from losses which would occur when the customer cannot afford the repayments, and the customer can be prevented from going down a path they will end up regretting,” added Beetar.
Read More: Around 40% of SA thinks it’s okay to lie about insurance claims and income, new survey says