Pictured above: Mark Kenkre, Partner and joint head of Challinors' Fraud & Asset Recovery department

Cheating has dominated the sporting headlines this summer, with little to separate the depths individuals are sinking to in the name of winning and financial reward, both on the field and in the board room, according to Fraud & Asset Recovery lawyers at Midlands firm Challinors.

"Over the summer, three sports have in particular had their reputations tarnished by individuals who have cheated to gain an advantage," says Andrew Thomson, a lawyer in the Fraud & Asset Recovery department.

"We have encountered 'bloodgate' in rugby union with a player using a blood capsule to fake a blood injury, a footballer allegedly diving to deceive the referee, and a Formula One driver being told to crash into a wall. 

"There can be no doubt that sport is becoming big business. The margins are slim between success and millions in prize money, and failure and substantially less cash reward. The motivation for instigating the use of the blood capsule may not have been the desire to win, but to gain the financial reward that comes with success." 

Cheating is also dominating the commercial arena and in turn the business pages of the press, which reflects the increase in fraud-related claims that has occurred since the economic downturn took hold.

A recent survey of seventy financial services institutions revealed that 80 percent believe insider fraud is on the rise. Mark Kenkre, a Partner and joint head of Challinors Fraud & Asset Recovery department, explains: "The survey also indicated that firms have invested in technically sophisticated technology to fight insider fraud, as the recession cuts deeper and more individuals are turning to fraudulent activity that they would not have considered before.

"In the first half of 2009, 20 percent of insider fraud was identified through internal processes and audit procedures, emphasising the need for businesses to have robust checks and systems in place. The role that staff can have in preventing fraud cannot be overestimated. Those who witness fraud must be able to step forward without fear of reprisal. 

"The 'bloodgate' in rugby union highlighted this perfectly, where it may be argued the worst crime was not the blood capsule being used, but the internal cover up following the event. The desperation to seek an advantage by using a blood capsule was considered bad enough, but the damning findings of the investigation into the matter showed a calculated cover-up. 

"Employers must put systems in place to prevent fraud but also engage employees in the prevention process," he says. "The pressure applied to the player who used the capsule was in part financial, with the financial implications to the club from him telling the full story being laid out quite clearly to him. Businesses must have effective systems in place to prevent fraud and also deal with the issue when it arises. Negative publicity generated by the existence of fraud should not prevent businesses tackling the problem when it occurs."

Whilst there are similarities between fraud in the business sector and cheating in sport, Mark believes an underlying issue remains: "In an economic downturn, finances become tighter and in turn individuals may look to commit fraud. The financial reward in sport has increased over the last ten years and the opportunity for financial reward in business has also grown. In the sporting arena gamesmanship has always existed, but now financial pressures are leading individuals to make decisions that have severe consequences. The recent survey into the wealth of Premier League clubs highlights the very point that sport is now big business. 

"There must remain the hope that cheating is not impossible to contain but the worry is that individuals will continue to work on the risk/reward basis. This may mean that even after the economic downturn subsides, fraud will remain a constant threat to the economy and to business." 

Challinors has offices in Birmingham, West Bromwich, Wolverhampton, Halesowen and Nottingham. The firm has 25 partners and over 100 fee earners, and is ranked as one of the top legal firms in the West Midlands, being Number 1 in the Chambers UK Directory in a number of categories, including Clinical Negligence. For more information about Challinors, visit: www.challinors.co.uk.