The value of fraud in the UK more than doubled in 2015, although the total number of incidences fell, a report out today has discovered.
The study by professional services firm BDO revealed that the value of reported fraud last year was £1.5bn, up 110 per cent from £720m the year before and the highest it has been since 2011.
However, the total number of reported cases of fraud dropped by 5.2 per cent from 546 in 2014 to 519 in 2015.
The financial services sector attracted an increasing amount of high value frauds, with the total value jumping from £238m in 2014 to £567m in 2015 while the number of incidences fell by 40 per cent from 119 to 70.
The situation could be more dire than the statistics suggest, thanks to the level of fraud in the industry that goes unreported.
"Increasingly we are seeing high value complex fraud being dealt with outside of the judicial system as companies prefer to deal with these situations behind closed doors to avoid the reputational damage to their businesses," said Kaley Crossthwaite, partner and head of fraud at BDO. "Our experience would suggest that both volume and value in real terms continue to rise despite efforts by companies in the sector to strengthen their processes."
London and the south east continue to be key areas for fraud activity, with the £600m worth of fraud that took place in the region in 2015 accounting for 40 per cent of fraud overall.
"As the financial capital of the UK, London has long been a hotbed for fraud and the 2015 data shows no sign of this abating," remarked Crossthwaite.
However, the increase in the value of fraud was far more pronounced in the Midlands, where it increased by more than 11 times from £33m in 2014 to £385m in 2015.
Crossthwaite added that the firm was also seeing an alarming number of incidences committed by people positions of power.
"Unfortunately most fraud is committed by people in trusted positions which can make it difficult to pick up but leads to a great sense of betrayal when it inevitably does," Crossthwaite said "We see so many instances of company or charity accountants, directors, senior employees, bank employees and secretaries defrauding their employers, customers or counterparts, often after many years of loyal service and usually to fund gambling habits or lavish lifestyles."