Fraud costs UK businesses over £13.8bn a year, according to Home Office statistics, yet many companies still aren’t taking time to stamp out dishonest practices.

The advent of the internet has created new opportunities for criminals but today most fraud is committed by companies' own employees via their computers, whether intentionally or accidentally, through storing illegal materials, pirating software or hacking restricted sites.

In general, companies seem to be way behind their employees when it comes to IT knowledge. And as staff getting more sneaky, firms need to understand how to locate and safely remove data from PCs.

"Without doubt [employees] are becoming more worldly wise to software that offers to hide or wipe evidence of their activity on a company computer," said Chris Watts, senior consultant at Forensics firm Vogon International.

It is essential that any evidence of fraud is not tampered with if legal action is going to be taken against an employee. To meet this requirement, companies need to use forensic software, says Watts.

Forensic software keeps track of an employee's 'work path' over a certain period of time, allowing the employer to view all internet sites they have visited and all software they've downloaded.

The IIA (Institute of Internal Auditors), a division of the DTI (Department of Trade and Industry) has published a guide to computer forensics to help companies understand how to monitor employees' internet habits and retrieve information, while acting within the law.

According to research conducted by Fast (the Federation Against Software Theft), 71 percent of businesses believed employees running illegal software had purchased it intentionally, meaning just 29 percent of cases were accidental.

"Many companies are behind their employees when it comes to piracy and retrieving information and this is why it's important they know where they stand," said a spokesman at the IIA.

But many companies have never even heard of forensic software and even fewer are running it.

"In most cases it would be uneconomical for a company to employ a dedicated forensics team," said Vogon's Watts. "But all companies should be aware that forensic tools are available for use and should also be aware of how to call on them if required."

Vogon recommends that where companies are having difficulty rooting out fraud they should call in the experts.

"What few people seem to understand is just how much data is lost and changed by simply turning on a computer.

"Company personnel could be left open to accusations that they have placed damning evidence on the hard disk. An independent expert, however, understands the rules of evidence and they are used to using the necessary tools on a daily basis," added Watts.

A copy of the guide is available here, priced £10.