The People Bulletin

Further to our story ‘Can you spot a fraudster in your work force?' (8 September 2010 ), cases of fraud are rising at an alarming rate.

According to the annual KPMG Fraud Barometer[1], incidents of fraud across the economy hit a 23-year high in 2010 with 314 incidents reported (total value of £1.37bn). The public purse has borne the brunt of the onslaught, with £571m worth of cases (42% of all UK fraud for the period) eroding government finances. One of the largest cases was worth £103m where a 48-year-old man claimed a flood of fraudulent bids for tax breaks on research into green technologies.

Private sector fraud has also grown with fraud increasing in this sector by 20% year-on-year, to £419m. Hitish Patel, forensic partner at KPMG observed: "Management remained unchecked during 2010…Being in a position of trust and authority enabled management to cause greater financial damage than employees." The biggest case in the period was worth £200m, where a director of a City firm transferred large sums of taxpayer money out of the country.  He then sent on to set up a currency exchange business to help more than 100 criminal clients to clean up the proceeds of their fraud. 

Professional criminals remain the biggest threat to the UK, being the largest group of fraud perpetrators, recording a total of £709m in 2010; 51% of all fraud.

In the Midlands, a DJ was accused of targeting the Apple and Amazon sites with 20 songs which they then sold through the respective websites. It is thought that they then stole 1,500 credit cards to by the songs, and then claimed back just under £469,000 in royalties.

Hitesh commented: "The online universe has opened up a whole new world for innovative fraudsters.  While credit card and data theft remain common tools from which they are able to profit, the need for ever more effective techniques to combat fraud grows greater by the dat.  Unfortunately, anti-fraud measures do not always keep pace with professional criminal activity." 

[1] http://rd.kpmg.co.uk/24595.htm