FRAUD could cost North Yorkshire businesses £11 million this financial year, the head of the county's fraud squad has warned.

Detective Sergeant Kevin Ross said that, while some estimates put the figure at £5.5 million, the real figure could "easily" be twice as high, taking into account unreported crimes.

The effects on businesses could be not only financial loss, adverse publicity, and damaged staff morale, but also job losses.

DS Ross, who was speaking at a business crime seminar organised by the Safer York Partnership, said the main fraud threat came from theft by employees.

"This is the single biggest danger to businesses in the county, and can be a bitter pill for them to swallow," he said.

DS Ross cited the case of a North Yorkshire woman, employed as a book-keeper for a local firm, who swindled £150,000 from the company.

"She was a model employee and her boss thought the world of her, but the business started losing money and the managing director couldn't find the hole in this previously successful enterprise," he said.

Investigators found that cheques intended for suppliers had instead been made out to various credit card and bank accounts.

DS Ross said £35,000 had been recovered, but the company was still down by £40,000.

He said the woman was now having a "short holiday" at Her Majesty's Prison Askham Grange.

Another major threat to North Yorkshire businesses is advance fee fraud, which DS Ross said was a "huge problem" in the county.

This is where businesses are conned into paying in advance for services they never receive.

In one such scam, carried out in Harrogate by a team of conmen from the North East, venture capital was offered to businesses at very competitive rates.

But firms had to put cash up front, and when they did so, the company disappeared.

One hapless entrepreneur lost £100,000.

"Of course it was all a mirage, a complete and utter scam," said DS Ross.

A third common means of fleecing county businesses is the long firm fraud.

DS Ross said that highly organised gangs of fraudsters form limited companies and order goods or services from local businesses.

They pay for the products and order them again and again, always paying for them.

Then when their credit rating is good with the supplier, they place a huge order, fail to pay for it and disappear.

DS Ross said the goods often then appear for sales at car boot sales, or market stalls across the county.

For advice on fighting fraud, contact the fraud squad on 01904 669760.