Fraud soared as criminals used pandemic to target vulnerable firms and individuals, research shows

August 9, 2021

Professional criminals took advantage of the unprecedented conditions caused by the pandemic to con businesses and individuals across the South West out of millions of pounds, new figures show.

According to accountancy group KPMG latest Fraud Barometer, cases reaching the region’s courts in the first half of this year soared by more than three times against the same period last year while the overall value of cases more than doubled to £7.4m. 

Of the 18 cases heard in court between January 1 and June 30, four involved alleged fraud above £1m in value.

Professional criminals, rather than rogue employees, were the most common class of fraudster,  according to KPMG, and were responsible for eight of the cases and involved sums totalling almost £3.5m.

And while commercial businesses were the most common victim of fraud last year, so far in 2021 members of the public have been the most common victims.

Nine of the cases heard in court arose through fraud against individuals, including three of the frauds above £1m. Businesses and government organisations suffered alleged losses from fraud totalling nearly £1.4m and £1.2m respectively, the research revealed.

And as the economic recovery continues, KPMG says attempts at fraud are likely to remain high and so is warning organisations and members of the public stay on their guard.

Case reaching the region’s courts during the past six months include:

  • A finance manager who abused her position to steal around £100,000 a year from her employer. In total she stole almost £1m and used it to pay for holidays, her son’s university fees and a mortgage on a property owned by her mother. The fraudster’s dishonesty was described at court as “startling in its depth and persistence”. 
  • An unlicensed financial adviser who tricked his elderly and sometimes dying clients out of more than £1.2m in a series of frauds spanning more than a decade. Despite promising to invest his client’s life savings, he instead spent most of it on holidays, gambling or to pay off his debts.
  • A courier who posed as a ‘special G4S agent’ to collect gold £845,000 from an elderly couple who had earlier been duped by another conman who claimed their bank account was compromised and advised them to convert their life savings into bullion. 

KPMG forensic lead for the South West, Damian Byrne, pictured, said: “Last year’s dip in fraud cases heard in courts across the South West region was, at least in part, due to the disruption to the legal system caused by the Covid-19 pandemic.

“The increase in fraud cases thus far in 2021 may continue as fraud risk remains high due to the combination of financial and other factors arising from the pandemic that increases vulnerability and creates opportunities for fraudsters.

“Our research shows that both individuals and businesses remain at risk of fraud, particularly from professional criminals, so it is important that organisations and members of the public alike remain vigilant.”

UK-wide, fraud cases that involved the public as victim soared to 50 cases with a value of £43.1m in the first half of 2021 compared to just 13 with a value of £22.6m during the same period last year. 

Cases relating to rogue tradesmen more than doubled in volume and was valued at £2.5m in the first half of 2021, mostly involving elderly and vulnerable people who were scammed for unnecessary work or paid for services that were then never delivered.

According to KPMG, this spike was potentially the result of an absence of family members or carers who would usually offer support or financial advice on these matters.

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