Anti-fraud experts are warning that iPods and other similar portable devices with hard drives are being used more and more to steal confidential corporate information.

Paul Carratu, president of the Association of Certified Fraud Examiners, the trade body for fraud investigation firms, told the London-based newspaper The Guardian iPods could be used by employees to fool security officials and breach data security rules.

"Corporates still don't know much about (the iPods) capabilities, but individuals do," Mr. Carratu said. "In a recent case, after we got a court order, we found the data the employer said was missing on a former employee's iPod."

In one case, a recruitment agency found much of its client database had been copied to an iPods's memory and used to defraud the firm.

Mr. Carratu said employers may believe that a member of staff plugging their iPod into a workstation is doing something innocent when, in reality, they are trying to defraud the firm.

"iPods are not a new toy, but whereas corporates still don't know much about their capabilities, individuals do. In a recent case, after we got a court order, we found the data the employer said was missing on a former employee's iPod," added Mr Carratu.