Large-scale fraud cases jump by 110%, says BDO

Cases of large-scale fraud jumped by more than 80 per cent in Scotland last year, but fell short of the 110 per cent increase shown by the whole of the UK, according to the latest BDO FraudTrack report.

BDO urged firms to have adequate checks in place to combat fraud

The study covers fraud cases exceeding £50,000, and these rose north of the Border to £18.2 million from £10m in 2014. That compares to the UK total jumping to £1.5 billion from £720m.

Accountancy firm BDO said Scotland’s total was “skewed” by the highest-value case, worth £6m, in Dundee. This involved a money-laundering scam known as “cuckoo smurfing” where legitimate cash intended for bank transfers overseas is replaced with “dirty” money, with funds deposited in unsuspecting individuals’ accounts.

The second-largest case of £4m involved a Glasgow convenience store operator who was charged with fraudulently evading VAT by failing to declare earnings.

BDO said the vast majority of frauds in Scotland last year involved theft and cash, for example an NHS worker stealing medical equipment worth £1.3m that was then sold for personal gain.

Sat Plaha, head of regional forensic services with BDO, urged workplaces to have in place adequate checks and balances to make sure trusted employees cannot exploit loopholes, as “clearly fraud remains a major issue for Scottish business”.

He added: “The problem is that individuals will always be placed in positions of trust — it just depends whether they decide to use that position for their own gain.”