Cyber fraud cases increase as courts ramp up action

Court cases involving alleged fraud dropped in value in the first half of 2019 to £319m, down from £345m in the same period last year, but there are signs cybercrime is becoming more sophisticated and fraudsters are sometimes repeat offenders

The KPMG Fraud Barometer report, which records fraud cases coming to UK courts with a value of £100,000 and above, found 217 cases in the last six months, a decrease of 13% on the same time last year, which saw 249 cases.

KPMG found a number of cases in which the commercialisation of cybercrime had been a factor, with criminals advertising their services on the dark web.  In one case, a cyber criminal who created a virus and launched an attack which knocked a communications company in Liberia offline, was jailed for 32 months.  He had been paid $30,000 (£24,700) by a rival company to cause the mass disruption - which the victim spent $600,000 repairing.

In one case a fraudster was caught trying to pay a £100,000 tax fraud debt with money he had stolen by staging another scam. The culprit first appeared in court in 2016 where he told the judge that he could repay the sum of £107,000 if given more time to come up with the money. Investigators from HMRC later discovered he was raising the cash to pay the debt through a second scam that involved stealing more than £580,000 from other businesses.  He admitted the second fraud at court in 2019 where he was jailed for four years.

The data also recorded a 57% increase in the number of account takeover cases where digital scammers used a range of techniques including email, text and apps to get hold of personal data that then enabled them to take over bank and credit card accounts.

In one case, a Tynesider who was the UK frontman for a scam conducted in India was jailed for 28 months at Newcastle Crown Court. The fraud involved online scammers who fleeced vulnerable computer users out of hundreds of thousands of pounds by pretending to help them fix bogus viruses or by hacking attacks on their computers.

Victims, many of them elderly, were panicked into contacting the fraudsters after messages informing them their computers had been infected either popped up on screen or were played through speakers.

When they followed instructions to contact a free number, they were put through to India-based crooks who said they could fix the problem for a fee. But once the scammers had access to victims' banking details, they plundered their accounts and sometimes installed software to allow them to steal more.

Roy Waligora, KPMG UK head of investigations, said: ‘We are noting a worrying move from criminals simply hacking as a means to an end to being industrialised personal data brokers on the dark web.  As our digital footprints get larger, cybercriminals will continue to develop new and innovative ways to steal personal data. If we are not alive to the threats, there is a great risk that we increase our vulnerability to criminals through our inaction.

Another trend indicated a number of repeat offenders heading back to court, with four cases of people with previous convictions for fraud coming back to court under new charges totalling £2.6m. In some cases, the alleged repeat offenders were able to secure employment in new roles where they subsequently were able to circumvent internal controls to continue to commit fraud.

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