UK’s new Fraud Strategy: more ambition needed

It is no secret that fraud has surged over the last few years. Increased digitalisation, the introduction of faster payments and, of course, the pandemic have combined to create a perfect storm. Throw in what is, at best, a lacklustre law enforcement and it is no surprise that fraud, which makes up over 40 percent of crimes against individuals and is the most common crime in the UK, has increasingly become a government priority.

The new strategy

At the start of May, the UK’s much-delayed new Fraud Strategy was launched to a somewhat muted response. The strategy aims to reduce the 2019 levels of fraud by 10 percent and disrupt 300,000 frauds by the end of this Parliament, through actions across three pillars: pursuing fraudsters, blocking fraud at source and empowering the public.

Taking these pillars in order, the headline grabbing announcement was the creation of a new National Fraud Squad. Staffed by 400 specialist investigators, little detail has been divulged about how the squad will work. Likely more a virtual network of existing parts of the law enforcement ecosystem, it’s also unclear if it will attract new funding. Even so, 400 staff will struggle to make a dent in the scale of the problem (estimated by the National Crime Agency to cost the UK up to £190bn per annum).

There is a commitment in the strategy to review law enforcement structures in due course and decide whether more structural reform is needed. This is welcome but probably needs to happen sooner rather than later; in a report last year, the Justice Committee described the criminal justice response to fraud as ‘disjointed and lacking in an overarching strategy to prevent, investigate, and prosecute these crimes.’

The strategy itself notes that for every 100 frauds committed, there is only one successful prosecution. Therefore, there are a raft of proposals to try and address some of wider issues that are hampering the investigation and prosecution of fraud, particularly serious and complex fraud. These include an end-to-end review of the criminal justice process and a new independent review which will cover, inter alia, the scope of the Fraud Act 2006 and the difficulties associated with disclosure in cases where there is a large volume of digital evidence.

The government has already committed to introducing a new offence of failure to prevent fraud for large companies in the Economic Crime and Corporate Transparency Bill and potential changes to the identification doctrine to make it easier to hold companies to account.