Fraud and the Justice System – Report Summary

This is a House of Commons Committee report, with recommendations to government. The Government has two months to respond.

Author: Justice Committee

Related inquiry: Fraud and the Justice System

Date Published: 18 October 2022

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There is currently an epidemic of fraud cases in England and Wales. Fraud now accounts for 40% of all crimes, increasingly facilitated by online methods, and another 25% growth in these crimes is anticipated in the coming years if there is not a considerable shift in the way they are investigated, prosecuted, and prevented.

Fraud is a crime which can have profound impacts on an individual, not only causing financial losses but emotional and psychological distress. It is difficult for victims of fraud to report their crimes and for those who most need it to receive specialist victim support. The dedicated reporting system for fraud, Action Fraud, is due to be replaced in 2024. It is crucial that this replacement does not just bring about improvements to reporting mechanisms and subsequent investigations, but also embeds a system that directs victims to appropriate support and keeps them updated on the next steps in their case.

We have heard that throughout the justice system, fraud is not considered a priority area. Very few case reports are passed to the police for investigation, and even fewer are prosecuted by the Crown Prosecution Service. Disclosure processes in fraud cases can be onerous and take up vast amounts of police and prosecution time, and there is a lack of expertise particularly amongst front-line police officers to identify and disrupt frauds.

The Government has asserted its commitment to tackling fraud, and a new Fraud Action Plan is due this year. Funding has been provided to support reporting mechanisms and police investigation; however, it remains to be seen if this will be sufficient to deliver meaningful improvements in the response to fraud.

Throughout our inquiry, we heard that while boosting the number of fraud crimes being successfully investigated and prosecuted is important, key to the fight against fraud will be preventing people from becoming victims of these crimes in the first place. The Government must work across the public and private sectors to unify responses to designing fraud out of systems and disrupting these crimes at the earliest opportunity in order to reduce the millions of individuals who are falling victim to these crimes each year.

A large volume of perpetrators are acting in whole or in part from foreign jurisdictions reducing the chance of successful prosecution. Furthermore, fraud offences are often enabled through third parties such as telecommunications, email and social media platforms. Given the importance of prevention and the limited opportunities for prosecution of foreign actors, legislation requiring such companies to prevent fraud should be introduced.

Overall, a wholesale change in philosophy and practice is needed to the way in which we fight fraud—one that takes it more seriously, gives it greater priority and resourcing, is more proactive in prevention, more aggressive in investigation, prosecution and conviction, and much more focused on its impact upon victims.