White collar crime is on the rise as the global financial crisis puts the squeeze on struggling New Zealand businesses and their executives.
Police and private investigators confirm the credit crunch has led to an increase in business fraud and employee theft, while desperate property owners and motorists are torching houses and cars in insurance scams.
Dan Thompson, director of leading investigation firm Paragon NZ, said the recent rising trend of corporate crime was similar to the aftermath of the 1987 stockmarket crash - and he predicted fraud would increase further over the next 12 months.
As the Wall St meltdown hits the New Zealand markets, Thompson said cash-strapped employees, contractors, service providers and management were resorting to fraud.
"When times get tough, people start looking after themselves. We're definitely getting a rise in investigations of people feathering their own nest," said Thompson.
"With the financial crisis, it doesn't take long for people to get worried and say, 'I've got to grab what I can'."
The Herald on Sunday last week reported a Manukau City Council manager had been charged with fraudulently obtaining $350,000 of ratepayer money.
Insurance fraud would also increase as a result of the credit crunch, said Thompson.
"As these times get harder, people start to rip the system off to get a few extra bucks in the pocket."
Any economic recession, let alone a global financial crisis, leads to a dramatic increase in insurance fraud, said Chris Ryan, chief executive of the Insurance Council.
He said insurance fraud was estimated at 10 per cent of total premiums - $300 million a year in New Zealand.
"There is a strong correlation between recession and fraud. We're seeing the initial stages of it and experienced insurance investigators are seeing similar sorts of claims coming through."
Desperate homeowners have even turned to arson to claim fire insurance rather than sell a house with a plummeting value, said Ryan.
As car prices fall, owners arrange to have their vehicles "stolen" or burned out. Likewise, Ryan said struggling businesses suffered "accidental" fires to claim substantial loss of earnings.
Detective Sergeant Hywel Jones, of the Auckland police fraud squad, expected a large number of corporate crimes to be discovered in the next 18 months, as businesses tighten shoddy accounting practices.
In recent boom times money was "free and easy" Jones said, but company directors will now "look at the books more closely" and start to pick up the frauds.
Jones, whose unit works closely with the Serious Fraud Office, said the size of the thefts - usually by an employee in a position of trust - was also skyrocketing.
"Your normal everyday fraud is around the $100,000 mark.
"And we've come across some as high as $3 million. That's not unusual any more."
Higher value, more complex company frauds are usually passed from the police to the SFO for further investigation.
SFO director Grant Liddell said mortgage fraud was popular during boom economic times, where "all sorts of schemes are hatched" using inflated property valuations or income to "rip off the banks".
However, Liddell said it was too early to say whether his office would investigate more fraud because of the tough economic times.