A rise in reported business fraud of 40 per cent in 2006 means that fraud has reached new record levels and is estimated to be costing UK businesses £1.37bn annually. Most fraud is employee fraud.

 

The number of reported frauds which cost the individual firms involved more than £50,000 was up by a third, to 295 cases.

 

However, even these figures are likely to be a considerable underestimate, as it is estimated that 85 per cent of frauds are unreported. Men are reported to be far more likely to commit fraud than women (men commit over 80 per cent of reported frauds) and the most common motivation is a desire to live a lavish lifestyle.

 

If you do suspect employee fraud, we recommend that you take legal advice immediately. Whilst your main aim will be to obtain evidence that will stand up in court, you should proceed with caution. There is a risk of action being taken against you should your suspicions prove incorrect or you act in a way that breaches an employee’s employment law rights. In addition, the way you gather evidence or record personal employee data must comply with the Data Protection Act.