Lack of high-value fraud prosecutions prompts warning of ‘tsunami’ of cases

Annette Barker

There were no high-value fraud prosecutions in Scotland in the first half of this year, according to data from KPMG.

The firm’s bi-annual Fraud Barometer measures fraud cases with losses of £100,000 or more reaching the UK courts. For the first time in the history of the report, zero cases were registered between 1 January and 30 June in Scotland, compared to four cases totalling £1.2 million during the same period last year.

The finding has prompted a warning that Scotland’s courts could witness a ‘tsunami of fraud cases’ over the next year as courts face a backlog of cases and a potential new wave of fraud driven by the COVID-19 pandemic.

Annette Barker, head of forensic at KPMG in Scotland, said: “With many of Scotland’s courts closed temporarily during the pandemic, it’s reasonable to assume the true extent of fraud committed across the country has been masked – not least as previous crises tell us that increased financial pressures on individuals can often drive increased criminal behaviour.

“Looking ahead, we certainly expect the fallout from the uncertainty caused by the pandemic to dramatically accelerate the levels of fraud hitting businesses, government and individuals.

“It is therefore absolutely vital that businesses and consumers remain vigilant as Scotland enters what is likely to be a very challenging economic climate which will only drive fraudsters to take full advantage.”

Elsewhere across the UK only 76 cases of alleged fraud were heard in courts in the first half of 2020 down from 217 cases prosecuted during the same period last year. This 65 per cent decrease reflects the significant impact of the COVID-19 crisis on law enforcement.

Almost £460m of alleged fraud hit UK courts in the first six months of the year, up by 44 per cent compared to the same period in 2019. One film piracy case, which if successful would have cost the industry an estimated £200m, nearly doubled the value of fraud committed to July 2020. By excluding this outlier, the data demonstrates a significant decrease in the value of fraud cases compared to last year; from £319m in 2019 to £260m in 2020.

Tags: KPMG, fraud

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