UK fraud levels double

Link: Finance worker defrauded Charter of £9m

Levels of reported fraud have doubled over the last 12 months to more than £640m, according to BDO Stoy Hayward.

The firm said that the 2003-2004 leap was fuelled by a rise in VAT and tax fraud. It found that London and the south-east were the worst hit, with the value of reported cases increasing by almost five times. Wales reported the lowest value, and was the least fraudulent part of the UK, with just £4m.

BDO estimated that the sharp increase would mean the UK taxpayer was the biggest loser, with VAT and tax fraud resulting in £291m of reported cases (compared with £157m in 2003).

The firm said that 2004’s overall fraud figure would exceed £700m as the figures only covered the period to the end of October, and added that other sectors including insurance, healthcare and finance were all at risk.

Andrew Durant a specialist fraud investigator at BDO Stoy Hayward said that prison sentences for fraudsters – on average just over two-and-a-half years – were too lenient.

‘Given the large sums fraudsters can hide in offshore accounts and property, such sentences are not going to deliver much of a deterrent even if they are caught – two years in an open prison followed by a lifetime on a beach somewhere warm and cheap living off the fraud’s proceeds,’ he said.

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