04 July 2008 | Paul Snell
Jail terms for those found guilty of fraud should be tougher, according to one of the UK's leading investigators.
Accountancy firm BDO Stoy Hayward made the call following the publication of its latest FraudTrack research. It showed in the past six months fraud cost UK businesses £705 million. This is an increase of 74 per cent compared with the same period last year.
And although the average custodial sentence for fraud has increased from 2.88 years in 2005 to 3.14 years in 2008, BDO says the sentences do not reflect the severity of the crime and its impact.
"While we know that UK custodial sentences for fraud have increased these are still low when compared with those of other countries such as the US, where large frauds can result in prison sentences of up to 20 years," said Simon Bevan, head of the fraud services team at the company.
Management fraud accounted for 46 per cent of cases, with third-party fraud, which includes cases involving suppliers, accounting for 32 per cent.
"What we are essentially saying is that management are robbing you blind, suppliers are ripping you off left, right and centre and regulators are breathing down your neck," added Bevan.
Greed remains the primary motivation for committing fraud, with debt as the second most common driver.