Fraud in Britain reaches new high, says KPMG survey

Accountants' survey finds employee fraud doubled in a year as Britons 'seek to feather their nests'

LAST UPDATED AT 10:05 ON Tue 22 Jan 2013

FINANCIAL pressure at home and at work has led to a big increase in opportunistic fraud, according to a survey by accountants KPMG. As the BBC reports, identity fraud hit £26.3 million last year, employee fraud doubled to £25 million while counterfeiting of goods hit a five-year high. 

The survey identifies so-called 'insider fraud' at companies as a major source of losses at companies with some 80 per cent of the cases spotted by KPMG involving workers or directors.

KPMG looks at fraud cases which reach the Crown Courts and involve over £100,000. "What we are seeing is individuals looking to feather their nests through ripping off employers, banks or the government," Hitesh Patel, UK Forensic Partner at KPMG, told the BBC.

"Times may be tough, but the data shows that some people are unwilling to give up the lifestyles they've become accustomed to."

Counterfeiting cases were worth £22.9 million while Ponzi investment schemes where new money is used to pay out existing investors hit £72 million.

The research indicates that scams carried out by professional criminals actually fell - some 98 cases went through the courts in 2011 but just 79 in 2012. · 

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Fraud is typically associated with the external threat posed to businesses by vendors and customers intent on extracting money through credit card and telemarketing scams and ID theft. Yet, insider fraud is the biggest threat to companies according to today’s report by KPMG. With fraud coming increasingly from within the organisation, how can companies protect themselves from “the threat from within” while also tackling professional fraudsters operating
outside the business?

The latest technology, based on innovative behavioural change identification algorithms can tackle these issues by rapidly identifying internal and external fraudulent behaviour, in real time and send alerts enabling businesses to stop it before it even starts. KPMG has identified the threat… fortunately a UK technology firm has the answer.

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