Fraud cases reach record value
02 Feb 2009, Accountancy Age, AccountancyAge
http://www.accountancyage.com/aa/news/1765482/fraud-reach-record-value
More fraud cases reached court last year than since 1995, according to KPMG.
The firm’s Fraud Barometer has revealed cases involving more than £1bn in fraud were heard in UK courts during 2008, the highest figure for 14 years.
The BBC reports KPMG’s Hitesh Patel, speculating that fraud could worsen in the near future.
‘These figures are bad enough in themselves, but I fear the trend for the next couple of years will be even worse,’ he said.
The value of mortgage fraud cases is reported to have increase by ten times over the past year,
Read the BBC story here
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Visitor comments
A major cause for concern should be the lack of basic controls over the spending of corporate cash
In response to news that UK companies suffered a five-fold increase in fraud last year, a major cause for concern should be the lack of basic controls over the spending of corporate cash through the purchasing process.
Despite the availability of e-procurement and automated purchase ordering solutions, the majority of organisations still run a manual purchasing process making it extremely easy for employees to place small orders for goods and services for their own use and get employers to cover the costs.
The lack of formal purchase ordering, the inability to control delivery locations, failure to use delivery notes as a means of confirming receipt, the inability to verify agreed values and total reliance on manual signatures for approval to pay for thousands of invoices combine to create an ideal opportunity for fraud.
Manual purchasing systems make it easy for individuals to defraud employers by ordering goods that are delivered to their home (and sold on eBay), by receiving commission from tame suppliers for overcharged goods and services, or by pushing bogus invoices through the system for small amounts that are unlikely to get noticed.
Only by automating the purchasing process can businesses gain visibility of all cashflow requirements from the moment a commitment is made.
As people become more desperate, the volume and value of fraud will continue to escalate, with those that are detected, and successfully prosecuted, remaining just the tip of the iceberg.
Yours sincerely,
Neil Robertson
Compleat Software
Posted by: Neil Robertson , 05 Feb 2009 | 00:00