Fraud in Britain cost companies, banks and the government more than a billion pounds in 2007, the highest amount in 12 years, according to ccountancy firm KPMG.
Although the number of fraud cases brought to court declined last year, the sophistication of the fraud lifted KPMG's Forensic's Fraud Barometer to its second-highest level in its 20 year-history.
"Levels of fraud continue to remain disturbingly high," said Hitesh Patel, partner at KPMG Forensic. "Organised gangs have been more active than ever, with a proliferation in VAT frauds, ID thefts and other forms of white collar crime."
Economic uncertainty and the global credit crunch may make this year even worse, he added.
Government agencies suffered most at the hands of fraudsters, according to the report.
One husband and wife team claimed benefits for no fewer than eight adults and forty six children at a one-bedroom flat in London, netting them more than £1 million.
Other gangs targeted the transport system, organising large scale frauds on fake bus and tube passes.
A Northern Ireland man routinely removed barcodes on items in a hardware superstore and replaced them with his own false barcodes -of cheaper products. He then sold the goods on eBay and made an estimated profit of £100,000 before he was finally caught.