There was a huge rise in cybercrime last year which helped overall UK fraud break through the £1 billion barrier for the first time in five years.

According to KPMG’s Fraud Barometer, cybercrime rose a whopping 1266% last year to £124 million, taking the total value of fraud to £1.1 billion.

KPMG’s Fraud Barometer measures fraud cases with losses of £100,000 or more reaching the UK courts.

The report found whilst the volume of alleged fraud for the year has dropped by nearly a third from 310 to 220, the value was up over 55% on the previous year’s £732 million.

The figures include over £900 million from just seven “super cases”, which involved alleged fraud of £50 million or more.

The surge in super cases, from £250 million in 2015, may be a reflection of fraud becoming a more lucrative and practical proposition for those with the right skills and technology, or those in senior commercial roles.

KPMG said that more people saw fraud as a shortcut to success and were willing to “disregard their moral compass” as a result of increased pressure to deliver on targets in a highly competitive and uncertain environment. Combined with this are new opportunities for fraud that have largely been created by new technology.

In one case a 51-year-old Leicester man was jailed for six years for masterminding a £60 million fraud to supply free cable TV using illicit set-top boxes. Working with five accomplices, he imported boxes from Asia and bypassed the encryption in order to allow people to watch a cable TV service without a legitimate subscription. He promoted the business on internet forums and via his own website, as well as making bulk sales of the boxes all around the UK.

Hitesh N Patel, UK forensic partner at KPMG, said: “The figures for 2016 tell us two things. Firstly, that we can expect more of these super frauds as challenging economic circumstances place pressures on businesses and individuals and as technology becomes more sophisticated.

“Secondly, that this is going to put even more strain on law enforcement agencies who don’t have the resources to investigate every report of fraud that they receive: getting the large, often cross-border and complex frauds to court is extremely time consuming and resource intensive. This places much more emphasis on businesses and consumers to protect themselves from fraudsters who will take advantage given the opportunity.”

Last year saw the largest cyber fraud since 2008, leading to losses of £113 million.

Victims were contacted by criminals claiming to be members of their bank’s fraud department and then persuaded them to reveal security details.

They saw false telephone numbers appear under the caller ID, and were unable to make or receive calls whilst their accounts were being drained. The fraudsters made between £1 million and £2 million a week at the scam’s peak and operated like a nine-to-five business using information from corrupt bank insiders.

Patel said: “Both public and private organisations openly acknowledge that cyber-attacks are one of the most prevalent and high-impact risks they face, and yet many operate on the basis ‘it won’t happen to me’. Organisations must keep abreast of the cyber threats, both physical and digital, to ensure the protection mechanisms don’t become obsolete given the pace of technology and business change. You can have variety of IT protections in place to defend yourself, but it’s all for nothing if you are tricked into giving away the keys to the electronic vault.”

Fraud against businesses was up seven-fold this year with internal fraud committed by employees and management the most common type of fraud to hit businesses.

Alex Neill, Which? managing director of home and legal services, said: “Today’s figures are yet more evidence of the widespread impact of scams and fraud.

“We’ve heard from people who have lost life changing sums of money to ever-more sophisticated scammers, and it’s clear that the Government, regulators and businesses need to do much more to protect consumers.”

Taken from http://bit.ly/2jpuBb4