According to mileage audit specialist TMC, on average in the private sector there is a 25% drop in mileage expense costs after they are properly audited, meaning that up to a quarter of fuel claims by UK employees may be fraudulent. This amounts to an estimated annual fraud cost of up to £1.6 billion for fuel claims alone.

'To many drivers, exaggerating mileage expenses is simply seen as similar to raiding the stationery cupboard, especially when times are tough financially,' said Paul Jackson, managing director of TMC.

He lists four of the most common ways of committing mileage fraud:

• Exaggerating the length of journeys by rounding up to the nearest 10 or 100 miles or overstating actual mileages.

• Claiming for journeys that the driver made but did not pay for (eg two colleagues share a car and both claim the mileage)

• Making unnecessary journeys to capitalise on over generous pence-per-mile fuel expenses rates

• Fabricating journeys entirely (for personal profit or to compensate for an inadequate pence-per-mile fuel rate)

Mr Jackson adds a final note of advice: 'Not all drivers who round up think they are committing fraud, and sadly nor do many managers who sign off the claims. Honest employees and business leaders may not realise the significant amounts of money being lost in this way.'