Recommendation 14

The Department has not identified what types of fraud it will prosecute, with the Department suggesting there is a range of criminality in fraud; it has euphemistically referred to ‘hard’ and ‘soft’ fraud.34 Hard fraud refers to a type of fraud committed by criminal organizations with the intention to defraud an organization. Soft fraud consists of borrowers exaggerating otherwise-legitimate claims, such as overstating turnover in order to receive a larger loan. We are is not convinced that this definition sufficiently answered the question regarding the counter-fraud protocols and the need for additional legislation to tackle fraud.35