Background to the report

The Ministry of Defence (MoD) is, like all parts of government, vulnerable to various types of economic crime and misconduct including fraud, bribery and corruption.

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It faces particular challenges in safeguarding public expenditure, with high expenditure, complex procurement and supply chains, and a workforce split between the Civil Service and Armed Forces.

To tackle these challenges, the MoD has both a counter-fraud team and several Defence police authorities, which span both the criminal and service justice systems, involved in responding to such threats.

The NAO has received whistleblowing disclosures over recent years indicating that individual allegations of economic crime and misconduct can take a long time to resolve or do not reach a satisfactory resolution, and that overall the MoD could manage fraud and economic crime far more effectively.

Scope of the report

This report investigates and provides transparency over the MoD’s management of its losses from fraud and economic crime. It covers:

  • how the MoD is set up to make savings by tackling fraud
  • the MoD’s understanding of its fraud risks
  • how the MoD handles fraud investigations, and the outcomes of its work
  • areas the MoD could improve to realise greater savings from
    its counter‑fraud work

The report does not provide details of individual fraud investigations.

Conclusions

The MoD has an opportunity to save money through better coordination and management of its counter-fraud and economic crime activity. It is still improving its understanding of its fraud risk, but it is highly likely that the amount it investigates, recovers and prevents is considerably less than the loss it incurs.

The MoD also reports a much lower financial return than other departments that invest a similar amount in counter-fraud activity. This is despite having stronger enforcement powers with its own in-house police services.

Using this resource more effectively will require the MoD to reform the way it goes about tackling fraud and other economic crime, which would enable it to achieve real savings that could be used to enhance its defence capability.

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Publication details

Press release

View press release (30 Jan 2026)

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