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Significant plunge in value of fraud cases, KPMG reports

Tuesday, 29 January 2013

Fraud cases in Scotland have returned to “normal levels” following a substantial spike in 2011, new reports have shown.

One of the ‘Big Four’, accountancy firm KPMG, have estimated the value of fraud last year at a little over £4.9m – a considerable decrease from £96.6m in 2011.

2011 had been dominated by the illegal fishing scandal where EU quotas were deliberately breached by certain fishing skippers and factory owners – this accounted for a total of £91m according to KPMG.

Overall, using their fraud barometer KPMG estimated that in the UK last year fraud reached a total of £824m.

In comparison to 11 fraud cases (those involving sums of more than £100,000) in 2011 and 16 in 2010, the Scottish courts only dealt his six such cases in 2012.

Some of the biggest cases included a gambling man whose habit lead to cheques worth £1.5m being cashed at a cash and carry in Dundee, as well as a restaurant supervisor who was incarcerated after transferring £700,000 to his own account using a credit card machine at a Little Chef.

Ken Milliken, forensic partner for KPMG in Scotland, said: "What we are seeing is individuals looking to feather their nests through ripping off employers, banks or the government.

"In the last few years we have become used to sophisticated frauds at eye-watering values.

"While the total value of fraud has dropped substantially in the absence of so-called fraud 'super' cases, the old-fashioned conman hasn't given up his tricks."

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

Further analysis of UK figures revealed a variety of statistics:

  • Identity fraud more than doubled in value to £26.3m from £12.3m the year before;
  • Counterfeit goods fraud was three times the five-year average at £22.9m;
  • Procurement fraud increased to £21.4m in 2012;
  • Employee fraud cases rose to 35 in 2012, up from 22 the year before;
  • Over-claiming benefits or evading tax has also become more widespread.

Ultimately however, the report did find how the number of organised crime cases fell from 98 in 2011 to 79 in the 12 months to December 2012.