UK fraud 'reaches 12-year high'

http://news.bbc.co.uk/go/rss/-/1/hi/business/7225145.stm

Version 0 of 1.

Fraud levels in the UK have reached a 12-year high, according to a study by accountancy group KPMG.

The total value involved in fraud cases going to court last year was more than £1bn, said KPMG Forensic, the firm's anti-fraud investigations team.

Organised criminals accounted for almost 90%, or £889m, of all fraud last year, it found, with the government being defrauded by a total of £833m.

So-called "carousel" VAT fraud was said to remain the biggest problem.

Under carousel fraud, criminals claim for the repayment of VAT that was never paid in the first place on goods imported and exported to and from other European Union nations.

'Extremely concerning'

In recent years mobile phone and computer chips have been two of the main items used by carousel fraudsters.

Last June the government introduced changes to the way VAT is charged on mobile phones and computer chips to try to reduce the extent of this fraud.

The report found that fraud using identity theft also remained a serious problem.

"Levels of fraud continue to remain disturbingly high," said Hitesh Patel, partner at KPMG Forensic.

"The sophistication of organised fraud in the UK is certainly extremely concerning.

"More fraud cases have been coming to court in recent years than previously, but one fears that this is just the tip of the iceberg."