A COMPANY director who conned investors out of millions in a Ponzi-style scheme run from an Edinburgh office contributed to a 300 per cent rise in fraud across the UK costing £70 million last year.

Stephen Farley, 47, who duped clients out of £18.4m, was among a number of individuals highlighted in a new report who cost victims and the tax man £69.6m – a 300 per cent rise in 12 months.

The total value of UK fraud is now at a five-year high, according to the new figures.

The unscrupulous Barbados-born businessman from Newtongrange, Midlothian, was jailed for seven years in November by Judge Lady Scott, who said his had been a complex, detailed and elaborate deception.

He ran the scam at his firm Cameron Farley’s offices at St Andrew Square in Edinburgh from April 2004 to October 2008.

He admitted the fraud at the High Court in Edinburgh. Potential investors would be contacted by him saying he would invest their money and trade it on the foreign exchange market. Losses would be limited and underwritten by insurance.

By April 2008, he launched a purportedly new investment opportunity, “guaranteeing” a 100 per cent return on any capital deposited, along with interest at 9.25 per cent. But his scam was akin to a Ponzi scheme fraud, and there were no investments.

Farley’s case was among 36 across Scotland – with tax fraud the most common – compared to 28 in 2015 The total for the UK as a whole was 504 cases, which in contrast to the Scottish figures represented a small reduction from the 519 the year before.

But global accountancy and business advisory firm BDO LLP’s annual research into reported fraud shows that the total UK value of fraud in 2016 rose to £2.0bn, a five-year high, an increase of 31.5 per cent from the previous year, and the highest value since 2011.

Public administration reported fraud rose sharply in 2016 with the value rising by 204.7 per cent to £1.4bn (2015: £450.9m). But this was largely due to a single £1bn VAT “carousel fraud” case involving a woman from York. Sarah Panitzke was named in October as one of ten British fugitives police believe to be hiding in Spain’s expat communities.

She was a senior member of gang behind a VAT fraud conducted by controlling many company accounts remotely via different IP addresses.

She travelled to Dubai, Spain and Andorra and was responsible for laundering approximately £1bn. Panitzke was sentenced to eight years in prison.

However, financial services, mortgage fraud and third-party frauds overall showed a significant year on year decline.

The report’s author, Kaley Crossthwaite, Partner and Head of Fraud, BDO LLP said: “It is extremely encouraging to see that the public and regulatory scrutiny within financial services is starting to gain some traction in reducing the volume and value of reported fraud.”

Insurance fraud dropped due to better anti-corruption systems.