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Fraud crime to rise up to £5bn by 2012, report claims

Published on 19 Jan 2010 under category: legal

Businesses are expected to lose up to £5 billion to fraud over the next two years, according to research from a global accountancy firm.

Research by BDO LLP has found that private companies and the public sector have experienced a 76 per cent rise in fraud during the recession, with an overall loss of £2 billion in 2009.

The value of fraud has also increased, and is predicted to cost the economy up to £5 billion by 2012 because businesses are more likely to discover discrepancies while they are taking cost-cutting measures.

Greed remains the single largest motivation for fraud at 80 per cent, but the report also found that white-collar crime by middle-managers is often done to preserve their jobs and standing in the workplace.

Simon P. Bevan, head of fraud at the accountants, warned that mortgage fraud had reached 18 per cent, with many fraudsters working in collusion with lawyers to borrow large loans against overpriced houses.

London and the south-east accounted for 77 per cent of cases, up on 14 per cent from last year. The report also claimed that fraud in the financial sector was not being publicly addresses with "well over 90 per cent of larger frauds" going unreported.

If you require advice on corporate fraud please call us on +44 (0) 20 7831 0101 and ask for Dan Hyde.