Value of fraud in North West rockets

The value of fraud in the North West more than tripled in 2017 as the region was ranked the third most defrauded region in the UK by value.

According to BDO’s FraudTrack report, which examines fraud cases over £50,000 in the UK, fraud in the North West accounted for 5% of the total value of reported fraud in the UK, as the value rocketed 235.5% from £34.5m in 2016 to £115.7m in 2017.

The research noted that despite the large increase in the value of fraud across the North West, the overall number of cases in the region decreased 5.5% to 69 cases in 2017 from 73 during 2016.

Some of the most expensive scams in the North West included a £17m tax fraud linked to the discovery of an illegal tobacco factory, and the case of a former maths teacher and ex-VAT inspector who tried to claim more than £4m back from HM Customs and Revenue with ‘fanciful’ accounts.

Nationally, the total value and volume of reported fraud in 2017 hit a 15-year high, with the value of fraud increasing 538% to £2.11bn.

In the last year, the financial services sector has witnessed the largest increase as the total number of cases rocketed by 72.4% and the value of fraud has risen by 318.8% to £899.7m.

Kaley Crossthwaite, partner and head of fraud and financial crime at BDO, said: “While a significant amount of fraud still goes unreported, our research suggests that people are becoming a lot 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. Stakeholders are seemingly no longer content to simply sweep fraud under the carpet in the hope that it will all go away.”

Sat Plaha, partner and national head of regional forensic services, added: “Whilst the regions outside London have experienced a fall in the total value of fraud in 2017, the 16% increase in the reported cases of fraud in the regions shows the growing risk of fraud.

“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.”