The Online Lodge

The year 2009 has earned the dubious distinction of being the year of frauds. An increase in cases of employee fraud and fraud in general has been recorded this year by the KPMG Forensic’s Fraud Barometer. A report stated that £1.3bn worth fraud cases were registered in the court. This figure is the highest since 1987, the year from which KPMG started recording this data.

This year also recorded the highest number of cases of fraud by managers and employees recorded since 1987. In the year 2008, a total of £129m fraud cases by managers was recorded while in 2009 this figure increased substantially to touch £335m.In case of fraud by employees too there has been a significant rise. The figure for the same in 2008 was £100m, which by 2009 has grown to £ 232m.

Some pertinent and critical facts were revealed when the figures were examined closely. Accounting and book-keeping departments were the ones from where many fraud cases were originating. A total number of thirty three cases of fraud worth £44m were recorded in 2009 from these divisions.

Further, more, it was also seen that many of the fraudsters were trusted employees working for their employers for many years. There were some cases where people with earlier history of fraud or deception had repeated these offences. The report cites the example of an accountant working in a property management company based in Birmingham who transferred £350,000 from the account of his clients to his own account. This accountant had a previous history of conviction for fraud under a different name.

While talking about the high incidence of fraud Hitesh Patel one of the partners of KPMG warned the employers to undertake a complete, meticulous security check during the recruitment process before hiring an employee. He stressed on the need of background check of candidates before employing them and said that this could save companies millions of dollars, which may be lost to fraudulent practices.

The Chartered Institute of Personnel and Development is the professional body for those involved in the management and development of people. Workplace Law run CIPD courses throughout the UK; training towards a CIPD qualification will help those to gain a broad grasp of employment law and understand how to implement best practice in recruitment and selection.