Thursday, May 13, 1999 Published at 09:16 GMT 10:16 UK
Business: The Economy
Internet fraud to cost UK business billions
Internet fraud is difficult to police
The rise of e-commerce on the Internet and the introduction of the euro could cost UK business billions of pounds, as both provide ample opportunities for fraudsters to take their cut.
The Fraud Advisory Panel, set up last year by the Institute of Chartered Accountants, said it was already impossible to know the full scale of fraud in the UK. Estimates range from £400m to £5bn a year.
The panel warned that some companies might underestimate the danger of fraud on the Internet, saying that "e-commerce and Internet trading are still in their infancy".
But the panel of experts - chaired by George Staples QC, former director of the Serious Fraud Office and currently a partner at City law firm Clifford Chance - points to the experience in the United States, where Internet fraud is rising sharply.
According to the US National Consumers League, reports of Internet fraud increased to 7,750 last year, up from 1,280 in 1997.
"Companies embarking on e-commerce must take control seriously," Mr Staples said.
The introduction of a new currency has always provided a big opportunity for fraudsters - witness the decimalisation in the UK in the early 70s.
But the introduction of the single currency, the euro, adds a new dimension to what criminals can do.
Mr Staples warned: "The introduction of the euro, together with the development of the single market in the EU, will inevitably provide increased opportunities for fraud.
"Money laundering across national frontiers is likely to become a major issue for the authorities," he added.
The Fraud Advisory Panel was set up in February 1998 to investigate the scale of fraud in the UK and advise on measures to beat the cheats.
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