Value of fraud cases soar

Sam Cordon

July 5, 2013

The data also revealed that investor fraud has almost quadrupled from £19m to £74m during the same period.

Hitesh Patel, UK forensic partner at KPMG, said: “While the back end of last year saw a resurgence of traditional con artistry, this year has seen fraud cases turn a darker corner with professional criminals acting across borders for the purpose of defrauding largely governments and financial institutions.”

“We can really see the manifestation of pressure on the family purse in the increase in honest investors defrauded.

“With pensions, traditional investments and incomes squeezed at the same time as inflationary pressures driving up costs, people are feeling compelled to seek alternative ways of growing their savings to maintain lifestyles.

“Unfortunately the public is vulnerable to Ponzi schemes dressed up as legitimate investment opportunities in the form of oil trading, wine clubs and property investments, which really are too good to be true.”

Patel noted the Financial Conduct Authority’s move to regulate alternative asset classes and said it could mitigate the problem but warned that the public should still be alive to the threat of investment scams.

Patel also warned investors. He said: “Organisations need to make the most of the numerous data sources available and overlay that with the information they have on a third party they plan to do business with.

“Joining up the data and information dots is a key tool in building a more informed picture to prevent risks crystallising to such an extent that it causes damage to consumers and organisations.”

Professional criminals became the biggest perpetrators of fraud in the first half of 2013 and were responsible for frauds totalling some £290m, up from £110m in 2012.

In line with overall national crime statistics, the data shows that fraud is overwhelmingly committed by men, with 86% of frauds in 2013 committed by men, and by people over 35 (responsible for 95% of frauds in 2013).

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