Wednesday 19th August, 2015

KPMG’s Fraud Barometer, which measures fraud cases with losses of £100,000 or more reaching the UK courts, has found that the value of fraud rose by 22% in the first half of this year to £385m (£317m in the same period last year).

With 160 cases, fraud volumes remained virtually identical to the first half of 2014, meaning that the average value of fraud has increased from £2m to £2.4m, a 21% increase.

The data shows a very marked increase in "middle man" fraud, up over 242% to £99m, as criminals insert themselves into the supply chain. However, it is those in positions of responsibility and management who have driven the growth in fraud, accounting for over 68% of fraud by value in the first half of 2015, compared to only 22% in 2014.

The barometer also reveals an explosion of cases in which individuals, betraying the trust of those closest to them, targeted their own relatives.

KPMG’s Fraud Barometer also revealed a surge in white collar crime, with those in a position of responsibility or management abusing their power to commit frauds totalling £262m, an increase from £72m last year.

Such individuals included an MEP and the head of operations at the Royal Horticultural Society. In the latter case, the perpetrator stole £700,000 from his employer, in the form of goods, services and cash over a number of years.

Hitesh Patel commented: "These white collar fraudsters often shelter in the business’ inner sanctum and can quietly wreak substantial financial havoc before their actions are uncovered."

"In the majority of cases the fraudsters’ motivation is simply one of greed as they seek to subsidise their high octane lifestyle at the expense of their employer or clients. These are often crimes of opportunity, made possible and tempting in the upper echelons of a business if blind faith and trust are a proxy for controls.”