Re: Deloitte-Touche: Fraud and the Net

[John Young <jya@pipeline.com>]

Declan wrote:
>I'd be happy to contribute towards the cost if someone else wants to take
>up a collection and buy the report. (If it goes online, as I assume it
>will, is this an example of a cypherpunkish "public good?")
>
>Or I can try to call up and get 'em to send me a copy as a journalist.

----------

Praps a local bloke can help us out:

The source is given as the D&T office in London: 

http://www.deloitte-touche-consulting.co.uk/about-us.html

Deloitte & Touche Consulting Group,
                          Stonecutter Court,
                          Stonecutter Street,
                          London EC4A 4TR.
                          Tel: 0171 303 3000

Sure, I'll buy it and pay for Fedex too; got my Amex and FX
numbers ready.

John

----------

   Financial Times, April 24, 1997, p. 3.


   EU fraudsters 'revel in fiscal paradise'

      Report urges Brussels authorities to crack down on $77bn
      cross-border corruption

   By John Mason in Brussels


   International fraud in the European Union could be costing
   governments, companies and individuals up to $77bn a year,
   a report commissioned by the European Commission has
   concluded.

   Crimes such as Internet abuse, counterfeiting, banking and
   investment frauds and smuggling pose an increasing threat
   which can only be countered by further international
   action, said Deloitte & Touche, the accountancy firm.

   Harmonisation of laws and regulations, improved
   co-operation between states and a greater stress on fraud
   prevention are needed if EU economies are not to be
   undermined by international criminals, the report said.

   Mr Will Inglis, the Deliotte & Touche partner responsible
   for the report, said: "There is clear evidence that
   determined fraudsters deliberately and cynical]y manipulate
   and take advantage of the different regulatory and
   monitoring regimes across the EU to perpetrate their
   frauds. In particular, we see the fraudsters taking
   advantage of havens of secrecy and fiscal paradises.
   Fraudulent activity in the Union has the potential to
   seriously distort competition and harm the citizens of the
   EU who end up paying the cost."

   The report identified 10 areas of concern: computer abuse,
   banking frauds, counterfeiting, investment fraud,
   confidence tricks, public sector fraud, fraudulent
   bankruptcy, insurance fraud, smuggling and money
   laundering.

   The type of crime varies considerably between countries. In
   the UK, financial services fraud is a problem because of
   the size of the industry, France suffers particularly from
   counterfeiting of luxury goods, while in Greece the
   smuggling of antiquities is second only to the drugs trade
   in terms of crime.

   However, across the EU, the removal of restrictions
   following the creation of the single market and
   technological advances have opened up opportunities for
   fraudsters, the report said.

   Perhaps the largest single threat comes from fraud through
   the Internet, Mr Inglis said. The potential for abuse of
   computer systems is huge, particularly since encryption
   technology is vulnerable to sophisticated computer abusers.
   The Internet is now also being used to manipulate financial
   markets.

   In other areas, fraudsters are becoming more sophisticated.
   Insider dealers are making more use of offshore havens to
   avoid detection while criminal syndicates with knowledge of
   banking practice have cheated banks.

   Not that frauds all need to be sophisticated. Italian
   investigators discovered that Libyan dinars were being
   taken to Naples to be literally "laundered" with a solvent
   and re-printed as D-Marks.

   The incidence of cross-border frauds is increasing faster
   than those which take place only within one country, with
   organised crime playing a substantial role, the report
   said. Other perpetrators of fraud, although on a lesser
   scale, include senior company managers.

   The report points to lack of legal harmonisation: In some
   EU states it is not even an offence to bribe somebody in a
   different country.

   Action against fraud can also damage a member state's
   economy. The use of "offshore" havens, some inside the EU,
   remains a common feature of fraud. But with some EU
   economies closely linked to the offshore world, the
   incentive to push for reform in this area is limited.

   Fraud, especially crossborder fraud, tends also to be given
   low priority compared to other crimes. There is also less
   political will to tackle money laundering when this
   involves fraud rather than drugs.

   The report concludes there are four priority areas - 
   increased legal harmonisation, improved co-operation
   between member states, a greater concentration on
   confiscating fraudsters' assets and developing awareness of
   fraud prevention.

   [Bar chart] Corporate Fraud. Countries involved, with two
   bars for each showing: Number of cases involving each
   region and number of times countries in this region were
   mentioned as being of concern.

   EU countries
   Tax havens/fiscal paradises
   Eastern European countries
   Others (including US and Asia)

   --

   "Fraud without Frontiers", L95, Deloitte & Touche, 1,
   Stonecutter St, London EC4A 4TR.

   [End]