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Published: Wednesday July 6, 2016

10 Year War on Fraud: Why We Urgently Need a Strategy After Brexit

This article by David Clark Group head anti corruption and multi linqual due dilligence services is reproduced by kind permission of our partner organisation www.todayadvisory.com

The Fraud Advisory Panel charity says the Government is not doing nearly enough to help the public defend themselves against the deluge of fraud and cybercrime and called for an improved local policing response and major public education campaign. The criticisms and call for action are made in the Panel’s latest report, ‘The Fraud Review 10 Years On‘ that is published today.

In 2006, the Government published the Fraud Review, the most comprehensive multi-agency, cross sector examination of the fraud fighting landscape every undertaken in the UK that was initiated by Lord Goldsmith the then Attorney General. The Review made 62 recommendations to improve the response to fraud and protect citizens and organisations from this serious threat.

Ground-breaking changes ensued with the design and delivery of the world’s first national service to enable the public to report fraud securely online or via a call centre and the creation of the National Fraud Intelligence Bureau (NFIB) with the people and powerful analytical systems to receive and process millions of pieces of data to prevent and fight fraud.

The Global Fraud Epidemic

Despite these advances, fraud has reached epidemic levels globally.; The annual cost of fraudulent activity in the UK alone is estimated to have reached£193 billion. This is an enormous 400% increase compared to the last estimate made in 2013 by the now disbanded National Fraud Authority which put the cost at almost £52 billion a year.  Both estimates were considered to be prudent at the time and the reality is the estimates may be just the tip of the iceberg.

Whilst reporting of fraud is increasing, the response by some police forces outside London is ineffective. “If a fraud victim involves their local police force they quickly find that much policing outside London is no better than it was 2005, with little chance of any kind of investigation.”  David Kirk, Chairman of the FAP said, “We need a nationwide fraud policing response that can match the challenge and government should find the resources to create it.”

The report also highlights the growth in online crime and Commander Chris Greaney, national coordinator for economic crime says, “The boom in computer-enabled crime is requiring complete change in how we approach policing. But this is a challenge for all of society because the risks are different.” 

Ten years on from the Fraud Review, much has been achieved but there is still so much to be done. We do not know for certain if the UK would be more resilient to fraud today if all the recommendations from the Review had been implemented but we can be sure we would be a lot more vulnerable if we did not have the specialist ‘ring fenced’ fraud resources we have as a result. Addressing members of the FAP yesterday, Lord Goldsmith praised the work of the police and the NFIB but said he was concerned by the absence of a national fraud strategy and coordinating body following the demise of the National Fraud Authority.

National Security vs Political Votes

Counter-fraud and corruption specialists know all too well how economic crime is easily dropped from the list of priorities for an organisation, especially when it doesn’t woo shareholders or voters. The same can be said for political parties and government agencies and that is what made Lord Goldsmith a visionary leader in 2005 when fraud wasn’t a vote winner. You can read the interview with him by downloading the FAP report by clicking here. Fighting corruption and fraud isn’t seen as a vote winner today. It is near impossible for over-stretched, under resourced police chiefs to justify investigating financial crimes that the vast majority of citizens do not see are inextricably linked to the suffering of millions and directly fund terrorism and violent criminal gangs.

Great Leaders Unite Society

Exceptional statesmen (and women) have an almost super human ability to unite society and galvanise support for ‘doing the right thing’, when the popular view is to ignore the problem, give up hope or turn one’s attention to trivial matters of little importance. Brexit has given Britons a renewed interest in politics. Much attention has focused on the UK’s contribution to the EU, alleged waste and bureaucracy, though the facts are still debatable. What is undeniable is the mountain of financial and economic loss the UK suffers as a consequence of fraud and how even a small proportion of the estimated £193 billion loss would be a welcome injection into the economy at this time of great uncertainty. Britain’s next leader would be wise to reflect on these issues and if they are a truly great leader, they will unite society in a renewed war on corruption and fraud.       .

I was a member of the original Fraud Review team and the police officer responsible for creating the NFIB. I see the need for greater cross sector coordination and agree the priority is to educate the public on how to avoid falling prey to criminals. That’s my view, but the message has to come from our Nation’s leader – and be said with conviction.

Education Education Education

Lastly, the FAP report highlights the growing threats in the the digital world. Let’s remember, it is humans not machines that commit crime, and the internet is just one of the many tools that fraudsters use to ensnare vulnerable prey. We all have a role to play in teaching our family, friends and colleagues how to protect themselves. A good start is to raise awareness of the existence of free resources like the Companies House and Solicitors Register and how to use them to identify and prevent fraud. The challenge in our instant gratification world is to encourage others to pause and research, and to make these online resources as familiar as ‘Google’. That may be a long shot but not the hardest lesson in life.

Click here for a list of some of those websites.

You can download a copy of the Fraud Review Final Report 2006 by clicking here

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