Written evidence submitted by the City
of London Police
1. The City of London Police (CoLP) has
led the delivery of the National Lead Force (NLF) and National
Fraud Intelligence Bureau (NFIB) since 2008. Prior to this, the
City Police had been designated lead force for fraud for London
and the South East since 2003. These fraud functions come together
as the Force's Economic Crime Directorate (ECD).
2. The NLF provides specialist advice on
law enforcement dealing with often highly complicated and detailed
criminality. Its objectives are to provide advice to all police
forces, industry investigators and other law enforcement agencies
to disseminate best practice, deliver training and act in an independent
advisory capacity to other forces on request. The Lead Force provides
a national investigative capacity to deal with all types of fraud
(subject to agreed case acceptance criteria) and to assist other
forces in local investigations and acts as a single point of contact
for anti fraud advice.
3. The National Fraud Intelligence Bureau
(NFIB) was created to help UK law enforcement agencies and their
partners catch and disrupt criminals and to alert communities
to threats from fraud. The Bureau gathers a large volume of information
on suspected fraud much of which is not reported to or made routinely
accessible to the police. This is analysed and turned into intelligence
such as the identification of the scale of fraudsters' criminal
activities. The intelligence is then used to support law enforcement
4. Although the deployment of the NLF is
subject to agreed case acceptance criteria, in practice there
is a lack of clarity over referrals with the result that overlap
occurs with other agencies responsible for the investigation and
prosecution of economic crime. The need to overhaul structures
gives rise to a question of whether the existing architecture
should be remodelled, or whether doing so would unnecessarily
compromise arrangements which have been shown to work. The NLF/NFIB
model has been shown to be effective in providing a delivery arm
for other agencies.
5. The cost-benefit ratio of CoLP's capability
has, arguably, never been more apparent or more important. A wide
range of policing resources each with expertise in their given
area is available to the Economic Crime Directorate of CoLP.
This feature, combined with established experience in general
fraud investigation, allows CoLP to undertake a wide-range of
investigations, invariably requiring methods and bringing skills,
knowledge and experience which are often beyond the cumulative
capability of other agencies.
6. More specifically, CoLP is the UK lead
for delivering and managing covert investigations linked to financial
crime. This includes possessing an independent infrastructure
to both authorise and review covert activity in line with current
legislation, an ability recognised by partners, which leads to
regular requests for assistance from overseas law enforcement
7. Intrinsically linked to this is CoLP's
expertise and existing infrastructure for dealing with duty of
care issues for victims and witnesses, including when required
complex witness protection issues. CoLP has already adopted ACPO
best practice guidelines, so as to manage and disseminate products
which are linked to either confidential or sensitive intelligence
8. CoLP has pioneered the management of
mass-victim cases. The processes and relationships developed to
deal with often hundreds of victims within one case, have taken
considerable time, experience and trust to develop. The techniques
now regularly used for mass marketing investigations and other
types of investment fraud are now being recognised as national,
and in some cases, international, best practice for victim care
and management. These relationships have flourished and reflect
the Force's long experience of fraud investigation and its history
of partnership working.
9. The Force's reputation is an essential
ingredient of the Force's ongoing operational success. The willingness
of other agencies, both private and public sector, to engage with
CoLP across its range of operational and strategic activities
is a significant enabler for the Force's joint operations and
10. CoLP has well established working practices
with the Bank of England, central to the work of the Force in
terms of both economic crime and security functions, along with
its strong relations with colleagues in the Security Services.
The Force has built on established relationships within the UK
and internationally to enhance its effectiveness with the US Federal
Bureau of Investigation (FBI), US Immigration and Customs Enforcement
(ICE), the Spanish National Police, the German Federal Police,
the Royal Canadian Mounted Police (RCMP), the Australian Federal
Police, Interpol and Europol. Other parts of the Force also contribute
to the delivery of National Lead Force and National Fraud Intelligence
Bureau functions. by providing supporting services.
11. Progress since the establishment of
the lead force arrangements in 2008 has been rapid, with over
600 investigations currently underway dealing with financial crime
involving assets valued at over £5.2 billion.
A total of 603 suspects are linked to current ECD investigations
of which 338 are on police bail, 129 have been interviewed under
caution (but not arrested) and 68 are wanted/missing. There are
32 defendants wanted on warrant and a new process has been completed
to assign responsibility to ensure these are monitored and actioned.
188 defendants have been charged and are awaiting prosecution.
The detection rate is currently 80%. The total number of victims
linked to ECD investigations is 3,080.
12. The CoLP has an established reputation
within the Criminal Justice System, especially among defence counsel.
It utilises a tried and tested case management system which is
supported by a dedicated and effective team, with an over-arching
CPS unit. This is undoubtedly a direct contributor towards a conviction
rate of 85% for CoLP's Economic Crime Directorate.
13. Until recently, the true extent of fraud
was not visible to the police or public despite accurate data
being held by numerous parties outside the police service. This
situation prevented the police and public from seeing the true
extent of fraud and making appropriate judgements on how to deal
with it. CoLP adopted a different approach by securing agreements
with partners to allow their data to be fed legally, securely
and automatically into the NFIB. Working with partners, CoLP has
built "Know Fraud" (probably the most sophisticated
police intelligence system in the world), which is able to analyse
millions of records to identify crime networks.
14. NFIB allows the police and others to
see for the first time, crimes, and the organised criminals who
perpetrate them along with the thousands of victims who suffer
as a result. It has enabled law enforcement bodies across the
UK to arrest criminal groups which had previously escaped the
attention of the police because crimes were not reported or shared
with the police. The Force's Economic Crime Directorate has the
ownership of and resultant responsibility for the management of
the serious organised crime threat in relation to non-fiscal fraud
(including money laundering) on behalf of the Organised Crime
Coordination Centre (led by the Home Office). Currently, this
stands at approximately one hundred and fifty organised crime
groups across the country.
15. The CoLP has an international brand
and an established track record of delivery, leading and supporting
complex investigations, and looking after the needs of victims.
Its geographical placement within a global financial centre enables
the force to continue to build and extend the reach of NLF and
NFIB by conducting further major cross border investigations against
serious organised crime groups of which those with Northumbria
Police and the FSA and West Midlands Police are current examples.
16. In performing its role as NLF, the City
provides support and leadership to local forces in their counter-fraud
work. In most cases, smaller scale local frauds are remitted back
to local forces to act as the lead enforcement agency. This maintains
local democratic accountability but with the reassurance that
forces are able to draw on without recharge, the wider resources
of the force that are required to support NLF investigations and
the continued development of NFIB. In addition, many operations
on larger frauds continue to involve local forces.
NLF AND NFIB AS
17. It is possible at least in theory to
consider the possibility of extracting the economic crime functions
from the City police and placing them in a new Agency. But in
practice it is likely such a move would be hightly disruptive
both to the contiued smooth running of those functions, and also
to the City of London Police whIch would become a "residual"
force. Stakeholders that supply CoLP with fraud data for the NFIB
do so under legal agreements that took two years to negotiate
and may not be transferable. Loss of these agreements would prevent
the NFIB from operating, thereby denying the police and public
access to vital data on criminals and victims that has taken so
long for the police to acquire. Continuation of the existing financial
and related support currently provided to CoLP by the City of
London Corporation could not be assumed.
18. But more than these concerns, uprooting
arrangements which have been shown to work for those which are
untested and will require relationships to be rebuilt and confidence
earned would be risky. Examination of alternative models, including
those where the investigative and prosecution arms are contained
within the same agency provide no grounds for assuming they achieve
better results. A recent report suggests,
that the number of investigations conducted and successful prosecutions
secured by SOCA, SFO, FSA and others is disappointing given the
level of investment in those bodies. In the same paper, it is
inferred that the City of London Police remain the most cost-effective
response to fraud with a budget of approximately £8 million
per annum and 140 personnel, compared with the FSA (£43.7
million and 35) and SFO (£43.4 million and 300) respectively.
The current figures for the City of London Police are shown in
19. The need to avoid overlap and consequent
inefficiency in the work of the agencies dealing with economic
crime is clear. The CoLP would welcome clarification of the case
referral criteria. An Economic Crime Agency could provide such
clarification in respect of the agencies with which CoLP deals
as NLF in high level fraud cases.
CITY OF LONDON POLICESUMMARY STATISTICAL
|(a) ECD Budget
South East Lead Force Grant
||Includes £1.215m from|
||mixture of Police Authority|
grant (not specific grants),
local authority grant, council
tax and City Corporation
business rate premium.
Home Office Grant for Fraud
National Lead Force Grant
||Includes £1m from City|
Home Office NFIB Grant
Overseas Anti Corruption Unit Funding
||20.44% of CoLP Budget of|
The figures above show a direct contribution of £6.85 million from City Corporation sources. This represents just under 50% of the ECD Budget.
In addition, the City Corporation contributes approx £490,000 to the rent of ECD Headquarters.
(b) Support to ECD from other CoLP directorates
Support from Counter Terrorism and Serious Crime Directorate
FDFT (Force Digital Forensics Team)
The current Force complement is 879.
The ECD complement stands at 154 Police Officers and 51 other staff.
(d) Value of Cases under investigation as of October 2010
1. 664 reports are under investigation.
2. Value of crimes under investigation£5.2 billion.
3. Of this sum
(a) £1.5 billion was subject of attempted criminality which was prevented so the assets were not, in the event, lost;
(b) £168 million has been recovered.
An annualised estimation of the value of these services is indicated
in the Annex.
ECD Monthly Performance Report, September 2010.
Fighting Fraud and Financial Crime, Jonathan Fisher QC, Policy
Exchange, 11 March 2010.
Revenue and Capital Budgets-2009-10 and 2010-11, Report of the Chamberlain and the Commissioner of Police to the City of London Police Committee, 15 January 2010.