Beware – fraud cases on the rise!

The Office of National Statistics yesterday released their report from the Crime Survey for England and Wales (CSEW) for the year ending June 2015. The report estimates that there were 5.1 million incidents of fraud in England and Wales in the 12 months prior to the survey. These estimates are significantly higher than those suggested by the police recorded figures, which previously did not include frauds reported by financial institutions and other public and private sector organisations.

Adrian Leppard, Commissioner of City of London Police last month warned fellow bosses that there would be a dramatic increase in the official crime statistics following the Office of National Statistics report focussing on cyber crime/fraud and that the spotlight would fall on this issue.

The increase brings crime levels to over 10 million a year, which demonstrates an increase in almost 40 percent. This will come as a shock to those claiming that crime levels have reduced over recent years.

Previous Office of National Statistics reports have been criticised for being outdated as they haven’t fully recorded the levels of fraud and cyber crime. Furthermore, there has been doubt cast on the figures released by the police following revelations that the figures can be manipulated to meet targets. Fraud and cyber crime are notoriously more difficult to investigate, often requiring additional resources and may affect large numbers of victims.

The release of these figures understandably raises concerns over the cuts faced by the police budget. Earlier this year, George Osborne told unprotected UK government departments, including the Home Office, to prepare for cuts of up to 40% in their budgets. The chancellor’s spending review document specifically highlights the goal of ‘supporting the police to innovate and exploit opportunities for greater efficiency and value for money’.

The revelation of these figures however, and the collapse of the company that ran the government’s ‘Action Fraud’ hotline, which has been criticised for failing victims since it took over the recording of frauds from the police, demonstrates the strain police forces are under when investigating these types of crimes thoroughly.

Broadcasting Support Services ran Action Fraud when it was first established in 2013, and continued to operate its call centres after the service was handed over to the City of London Police last year. The company went into administration in July and is now operating with a skeleton staff, with some calls going unanswered.

Action Fraud was first established two years ago as a nationwide, centralised means in which members of the public and businesses could report financial crime. It was set up after the National Audit Office found that only 26p in every £100 stolen was recovered by law enforcement authorities in 2012/13, and to address public confusion over who best to report incidents of fraud to out of the many agencies working in this area, including the Serious Fraud Office (SFO), Financial Conduct Authority (FCA) and local police.

The number of people prosecuted for fraud and corruption offences fell by almost one fifth between 2011 and 2014, despite an increase in the number of tip-offs to Action Fraud and the SFO’s ‘SFO Confidential’ tip-off line.

It is no wonder that in times such as these that private prosecutions are becoming a more popular, and perhaps preferred method of dealing with fraud.  Edmonds Marshall McMahon, the only specialist private prosecution firm, were recorded earlier this month in The Times stating that the cutbacks to law enforcement and prosecution agencies has led to a rise in the number of private prosecutions over recent years. Some 90 percent of our clients have tried to have their matter investigated by the police without success or their cases have been rejected by the CPS.

Fraud is on the rise partly because it is now much easier for fraudsters to target large numbers of victims. The internet has allowed for bulk emails to be sent out aiming to get hold of personal financial information and bogus websites are set up to trick users. The latest in a series of sophisticated scams is the ‘vishing’ technique whereby fraudsters phone up pretending to be from the victim’s bank or the police and manage to persuade the victim to move their money from their account or to provide personal log in details. In these instances banks cannot always be relied upon to compensate for the lost money, so a thorough investigation is required in order to trace the funds.

In light of the figures released yesterday, it is now more important than ever to be vigilant and suspicious when it comes to banking and financial transactions and to act quickly if anything out of the ordinary occurs.

Fani Gamon