More than half of UK companies suffered from fraud in the past two years, losing an average of £1 million, a report yesterday showed.
Around 55 per cent of British firms reported being hit by economic crime or fraud and the majority only discovered by accident, a survey by auditor Pricewaterhouse-Coopers found.
The figure compares with an average of 45 per cent of businesses worldwide suffering from fraud.
Despite the high rate of economic crime, around 75 per cent did not think it likely that they would suffer fraud over the next five years, while 74 per cent said they were satisfied with their internal controls, even though the most common method of detecting fraud in the UK was by accident.
Internal audit departments uncovered 24 per cent of fraud cases.
"The continued rise in economic crime poses a serious threat to UK businesses," said Andrew Clark, partner in the investigations and forensic services practice at PwC.
"Many companies have a false sense of security when it comes to economic crime."
Half the incidents of fraud were perpetrated by a company's employees and the average UK fraudster was male, between the ages of 31 and 40 and who held a position in middle management or below.
UK companies suffered an average of nine incidents of economic crime, including embezzlement, misrepresentation of accounts and money laundering, in the last two years.
The larger the company, the more likely it experienced and detected acts of fraud.
Fraud costs the UK around £14 billion a year and The Financial Services Authority estimates that £25 billion of dirty money is laundered through British financial institutions every year.
Last month the Government launched a review to establish a national fraud strategy.
