Government AI tool is focused on dormant companies

Government AI tool is focused on dormant companies

The government’s artificial intelligence (AI) fraud detection tool has been upgraded to include new data on thousands of dormant companies.

In a new bid to clamp down on fraud, the government also plans to use AI to identify entities registering and bankrupting successive companies to avoid paying debts, known as phoenixing.

The AI system will be set up to detect suspicious networks, activity and users that warrant further investigation for organised crime and sanctions purposes.

The latest data includes information on 647,000 dormant companies that do not have any income, as well as details on UK and US sanctioned entities, including those introduced following Russia’s invasion of Ukraine.

With this new data, public sector organisations will be better supported to detect fraudulent claims on public funds through contracts, grants and loans.

A minister of state at the Cabinet Office, said: ‘Criminals should be aware that we’re putting technology on the front line to detect fraud and protect taxpayers money.’……..

All this comes on top of the Chancellor’s decision to invest £34m to build additional counter fraud tools with the government’s Incubator for Artificial Intelligence (i.AI). The investment announced in the Budget is expected to save taxpayers £100m over the next spending review.

In January 2024 the Public Sector Fraud Authority (PFSA) said that £99.5m of pandemic-era fraud had been identified through a data sharing pilot enabled using the Digital Economy Act 2017. This is one of more than 100 pilots which the PSFA has run with 70 local authorities and 17 government departments since 2018. The new strategy commits the government to launch further pilots in the years ahead.

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