DPP Business Tax

White-Collar Crime Statistics

Her Majesty’s Revenue and Customs is performing a long-running crackdown on white-collar crime such as fraud, piracy and cybercrime. But exactly how common are these types of offence and how are they committed?

DPP Business & Tax have collected a range of white-collar crime statistics in order to explore this illegal field.

Forgery and fraud

Top types of fraud reported in 2019

According to the Crime Survey for England and Wales, as of June 2019 there had been 3.9 million incidents of crime reported since the same date in 2018.

On the other hand, the National Fraud Intelligence Bureau received just 0.7 million incident referrals of this kind.

The Crime Survey’s data reveals that the total number of incidents of fraud had increased by 15%. Breaking this down into types of fraud, this totalled:

  • 2,666,000 cases of bank and credit card fraud (a rise of 17% since the previous year)
  • 962,000 cases of consumer and retail fraud (a 4% rise)
  • 47,000 cases of advance fee fraud (a drop of 43%)
  • 188,000 cases of other types of fraud (a 183% rise)

Looking at the two year period between 2017 and 2019, the most common types of fraud were:

  • Online shopping fraud (86,127 reports)
  • Advance fee fraud (78,868 reports)
  • Computer fixing fraud (38,891 reports)
  • Cheque, card and online bank fraud (35,502 reports)

Bogus tradespeople, computer virus attacks, dating scams, fake loan frauds, hacking of social media or email, investment fraud, mandate fraud, retail/consumer fraud and ticket fraud were also particularly prevalent.

How much money has been lost through fraud over the past year?

The most recent white-collar crime statistics show that the UK is losing around £190 billion to fraud per year. This includes:

  • £140 billion for the private sector
  • £40 billion for the public sector
  • £10 billion for individuals

Where do people commit fraud most and least?

The southeast of England seems to host the largest number of fraud cases. Essex is top for consumer fraud and bank fraud, with 12.7 and 12.2 reports per 10,000 people respectively. The national average for each is 11.3 and 5.4.

London sees the most fraud involving online shopping, ticketing and investment (17, 4.5 and 1.9 reports per 10,000 people respectively, with a national average of 13, 2.2 and 1.3).

Hertfordshire is the area with the highest amount of social media and email hacking. 3.5 reports are made per 10,000 people while the national average is 2.5.

Surrey sees peak numbers of mandate fraud (3.3 reports per 10,000 people with a national average of 2), computer virus attacks (2.5 with a national average of 1.9) and bogus tradespeople (3.2 with a national average of 1.8).

Sussex is home to the highest number of dating scams, with 1.9 reported for every 10,000 people (the national average is 1.1).

The Midlands and East Anglia also have their fair share of fraud, with:

Northamptonshire seeing the country’s largest amounts of fake loan fraud (1.8 reports per 10,000 people with a national average of 1.2)
Warwickshire home to the highest numbers of advance fee fraud (15.8 with a national average of 11.9)
Norfolk seeing peak levels of computer fixing fraud (10.3 with a national average of 5.9)

Who are fraudsters targeting?

According to top fraud and forgery statistics, the average age of an individual reporting a scam was 49, with the majority of victims in most categories of fraud falling between the ages of 40 and 60.

Rental fraud was a clear outlier, with the average victim age being 33. However, this is probably due to a younger demographic being more likely to rent.

Victims of ticket fraud, online shopping fraud and auction fraud had an average age of 37.

Counterfeit and pirated goods

Which industries are most affected by counterfeit products?

The Organisation for Economic Co-operation and Development (OECD) has reported that between 2017 and 2019, the rise in value of counterfeit goods was equivalent to 3.3% of trade worldwide. The amount itself rose from $461 billion to $509 billion.

The two industries most affected are tobacco and clothing. They are followed by footwear and perfume (on an even footing), then watches and jewellery, alcohol, electrical goods, toys and DVDs.

When it comes to the most popular locations for the sale of counterfeit goods, statistics show ordinary shops coming out on top at more than 70%. Social media is next at just 10% less, then websites and private residences. In order, the next most common are:

  • Auction sites
  • Outdoor markets
  • Street sales
  • Pubs and clubs
  • Car boot sales
  • Factories and industrial units

Where do the most counterfeit and pirated goods come from?

The People’s Republic of China is the source of the vast majority of counterfeit and pirated goods, with between 50 and 60% of products of this kind sourced there.

The next most prolific locations are:

  • Hong Kong
  • Turkey
  • Singapore
  • Germany
  • India
  • Former Yugoslav Republic of Macedonia
  • Thailand
  • Malaysia
  • Mexico
  • The US
  • The UAE

In the UK, some of the most common locations for the illegal production of counterfeit goods include “sweat shops” in Leicester, Birmingham and Manchester.

How are fake goods transported?

The highest value of counterfeit goods is sent via sea, with 56% being transported in this way. In order, the next most popular methods include:

  • Air (16%)
  • Post (11%)
  • Courier (8%)
  • By road (7%)
  • By rail (2%)

However, the number of customs seizures sees just 10% of counterfeit goods overall being transported by sea.

  • 15% by air
  • 57% by mail
  • 12% by courier
  • 5% by road
  • 1% by rail

Which companies and businesses are most affected by counterfeiting?

In 2019, the most popular brands for counterfeiters to reproduce have been:

  • Nike
  • The North Face
  • Cartier
  • Hermeś
  • Levi’s
  • Louis Vuitton
  • Tiffany and Co.
  • Coach
  • Ugg
  • Polo Ralph Lauren
  • Ray-Ban

How much did counterfeit and pirated products amount to in 2019?

The amount made by pirates and counterfeiters in 2019 equated to approximately £9.3 billion. These goods made up the value of around 4% of UK imports.

£4 billion worth of tax revenue was lost in this way, equating to the amount that would be made through 60,000 UK jobs.

Which countries does counterfeiting affect the most?

The US is one of the biggest victims of counterfeiting. In 2016, American brands made up 24% of those counterfeited worldwide. The following countries also suffered considerably as a result of this kind of offence:

  • France (with 17% of counterfeit goods based on French brands)
  • Italy (15%)
  • Switzerland (11%)
  • Germany (9%)

Other targets include companies from Singapore, Hong Kong, Brazil and China.

The demand side of the fraud equation

So how many people are searching for counterfeit products?

The collaboration between Nike and Kanye West appears to attract the highest number of people looking for “knock-offs”. The current most popular internet searches for counterfeit goods per month include:

  • “Fake Yeezys” (21,000)
  • “Fake Airpods” (13,500)
  • “Fake Yeezys for kids” (6,600)
  • “Fake Yeezys zebra” (5,400)
  • “Cheap Nikes from China” (3,600)
  • “Replica Nikes” (2,900)
  • “Face Rolex” (1,200)
  • “Fake Gucci” (1,000)

Embezzlement

How long do embezzlement schemes last?

The average embezzlement scheme lasts 4.7 years.

Are men or women more likely to commit embezzlement?

While more women tend to commit embezzlement than men, the average male embezzler tends to work with higher amounts.

What is the average prison sentence for embezzlement cases?

Typically, an individual found guilty of embezzlement may be jailed for up to five years. They are also often served with a fine.

Cybercrime

What percentage of organisations are affected by cyber-attacks?

Over the past year, 32% of businesses and 22% of charities worldwide have fallen victim to cyber-attacks. However, this number is gradually falling – as in 2017, 46% of businesses reported being affected by this kind of offence.

On average, a business that has experienced a breach or cyber attack loses £4,180 in a year as a result.

How often do attacks occur?

There were an estimated 65,000 attacks on small businesses within the UK in 2018, totalling approximately 178 per day.

Globally, this equates to 1,824,000 attacks – or around 5,000 attacks per day.

Which country is hit the hardest by cyber-attacks?

From 2006 to 2018, the following countries experienced the highest numbers of significant cyber attacks:

  • The US (117 cyberattacks with losses of more than $1 million each)
  • India (35 major attacks)
  • South Korea (34 major attacks)
  • China (25 major attacks)
  • UK (25 major attacks)
  • Israel (24 major attacks)
  • Ukraine (23 major attacks)
  • Russia (16 major attacks)

Countries in the “rest of the world” category have seen approximately 165 incidents in total.

H3: Which countries commit the most cyberattacks?

The source of the majority of cyberattacks is estimated to be China. The country was believed to be involved in 108 major cyber-attacks between 2006 and 2018. Following this, the most prolific cyber attackers are based in:

  • Russia (98 major incidents)
  • Iran (44 major incidents)
  • North Korea (38 major incidents)
  • India (16 major incidents)
  • US (9 major incidents)

What percentage of UK data breaches were due to ransomware?

12% of cyber attacks on businesses in the UK were due to ransomware, as were 7% of attacks on charities.

The most common form of cyber-attack by a significant margin was perpetrated through fraudulent emails or redirection to fraudulent sites. This made up 80% of attacks on businesses and 81% of attacks on charities respectively.

H3: What percentage of victimized organisations paid the associated ransoms?

According to our collected white-collar crime statistics, around 58% of affected UK companies agree to pay the requested ransom when attacked by ransomware. This is despite guidance from the FBI and the National Crime Agencies warning against doing this.

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