20% Of all fraud in first six months of 2010 was in the mortgage sector
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Mortgage fraud is showing no sign of diminishing, with latest figures revealing it accounted for 20% of all fraud in the first half of this year.
Mortgage fraud totalled £190m and made up 36% of all fraud in the financial services sector.
Figures from Fraudtrack, a survey by accountancy firm BDO LLP, which has one of the country’s largest teams of specialist fraud investigators, shows a marked increase in mortgage fraud in the first half of 2010 compared with 2009.
In 2009 mortgage fraud only accounted for 18% of all reported fraud and 27% of all fraud in the finance sector.
Overall, the average value of a single fraud has increased to almost £6m, rising from £5m last year. BDO LLP predicts that the value of the average fraud will top £7m by the end of 2010.
The finance and insurance sector remains the dominant crime risk, accounting for some 49% of all fraudulent activity.
Third party customers and suppliers are responsible for 17% of all reported fraud involving businesses, while internal management cooking the books accounts for 16% of all reported fraud.
Simon Bevan, head of the fraud services unit at BDO LLP, says: “We are seeing a rise in the number of companies in which managers commit
Bevan believes UK regulators will take an increasingly tough stance as they compete with international watchdogs to root out abuse in regulated markets.
Brendan Hawthorne, managing director of consultancy Kroll, says: “The Fraudtrack report closely mirrors what we’re seeing in our work - that fraud is still on the increase and that it’s one of the key issues affecting businesses in the UK and around the world.”
Hawthorne adds that Kroll has noted a marked increase in the sort of mortgage and property development fraud in which parties collude over valuations.
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