The total value of fraud in the UK has risen by 538% to £2.11bn in the past 15 years, and was up by 6.5% in 2017 from £1.99bn in 2016, new research shows.
The study by accountancy firm BDO LLP, which examined reported fraud cases of more than £50,000, shows that the financial services sector was the worst affected.
The total value of fraud in 2017 in this area reached £899.7m, compared with £214.9m in 2016—a rise of 318.8%. The total number of fraud cases in the financial services sector also rose by 72.4% since 2016.
Another dramatic increase in 2017 occurred in the charity sector, with the value of fraud rising by more than 300% to £8.5m, up from £2.1m in 2016, as the number of reported cases almost doubled.
In contrast, public administration fraud saw a 73.2% drop in value to £368.5m from £1.37bn in 2016.
The greatest increases over the past 15 years occurred in real estate, rental and leasing fraud, with the total value shooting up to £276.5m from £1.08m; and retail trade fraud, which grew from £15.5m to £337.3m.
Greed remains the greatest driver of fraud across the UK with 18.9% of cases attributed to human avarice. Gambling and debt were the next biggest contributing factors to reported fraud, with 33 and 19 cases respectively out of a total of 577.
Sat Plaha, partner and national head of regional forensic services at BDO, commented: “The rising economic pressures and the continuing sophistication in technology mean that fraud is still a contemporary risk for most businesses, and therefore it is essential that businesses continue to deploy a proactive risk-based approach to protect themselves from harm’s way.”
Kaley Crossthwaite, partner and head of fraud at BDO, added that while a significant amount of fraud still goes unreported, the research suggests that people are becoming more courageous in coming forward to report it, and recovering their assets through the criminal or civil justice systems.
“There is now an expectation that fraud will be reported and investigated, both internally by corporations, charities, public sector entities and companies operating within regulated sectors,” she said. “Stakeholders are seemingly no longer content to simply sweep fraud under the carpet in the hope that it will all go away.”