Reported cases of business fraud have risen by 450% during the first six months of 2009, according to the accountants BDO Stoy Hayward.

The first six months of 2009 has seen instances of business insurance fraud increase by 450% according to a leading accountancy firm in the UK.

So far this year fraud has cost Scottish companies £10m compared with just over £1.8m for the same period last year.
While the accountancy firm had predicted a rise in fraud because of the economic downturn, the increase has been shocked even industry experts.

The level of recorded fraud only tells half the story as lots of fraudulent activity goes unnoticed or companies avoid reporting it.
A spokesperson for the accountancy firm said: “Victims of fraud primarily focus on recovering assets, preventing future fraud and, most pertinently, minimizing publicity.”

Scottish figures reflect a similar level of small business insurance fraud to the rest of the UK. The UK saw a total of £960m worth of fraud reported within the first six months of the year.

Particularly hard hit in the UK were the banking and insurance sectors, where 90% of the fraud took place.
Greed was given as the motive in 36% of the cases, with debt the reason in 25% of cases and gambling at 24%.
The worst areas for fraud remain in London and the South East, however, the North East of England has also seen substantial increases this year.