Justice System ‘Inadequate’ in Face of Rising Fraud

Justice System ‘Inadequate’ In Face of Rising Fraud

MPs have raised serious concerns that the criminal justice system cannot cope with the increase in fraud cases – with fraud now making up 40% of reported crimes. Sian Norris reports

The UK justice system is “inadequate” at tackling the “epidemic” of fraud, with the specialist service designed to deal with the crime judged as “unfit for purpose” by MPs.

A new report published by the cross-party House of Commons Justice Committee has found that police are struggling to deal with cyber crime and fraud, due to a lack of funding and the changing nature of scams, with vulnerable people being robbed of large amounts of money via phone calls, social media, and emails. 

Action Fraud – the national reporting centre for fraud and cyber crime – was found by MPs to be “unfit for purpose”. The committee stated that while a replacement service is due to be established in 2024, “victims should not have to wait this long to see improvements”.

Chair of the Justice Committee Sir Bob Neill MP said: “People are losing their life savings and suffering lasting emotional and psychological harm. But the level of concern from law enforcement falls short of what is required”.

The committee also warned that prioritising traditional forms of crime has left the system struggling to meet the demands of fraud and cyber crime. 

“A week ago, it was announced that it is now a key priority for police to attend every burglary reported to them,” said Neill. “It is right that victims of such invasive and traumatic crime should know that they will be supported, but we should not underestimate the impact that offences of fraud also have upon victims”.

Fraud accounts for 40% of reported crime and yet only 2% of the policing budget is dedicated to tackling it. And while the Office for National Statistics estimates there are 4.6 million fraud offences each year, the prosecution rate is concerningly low: in the year ending September 2021, only 7,609 defendants were prosecuted for fraud and forgery as the principal offence by the Crown Prosecution Service. Fraud costs society £4.6 billion each year.

Elderly people are particularly vulnerable. According to the organisation Lottie – a free service that helps families and retirees find the UK’s best care homes and retirement living communities – an older person becomes a victim of fraud every 40 seconds. It has discovered a surge of people going online to search for scam support, with a 50% increase in searches for WhatsApp scams, as well as a 1,900% searches for advice on energy scams, suggesting those who commit fraud are exploiting the cost of living crisis when people are most vulnerable.

Wayne Stevens, National Fraud Lead at the charity Victim Support, told Byline Times: “Falling victim to a fraud can unravel your entire life. We have supported people who have lost life changing amounts of money – forcing them to sell treasured possessions, or in extreme cases, into bankruptcy or homelessness. For others, the experience has disturbed their fundamental sense of safety. Victims can struggle with their mental health, sometimes becoming too afraid to leave their home or go back online”.

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‘I Kept It To Myself’

Phil first realised he had been the victim of identity fraud when he received a statement from his bank demanding payment for items he had not purchased.

“I called them right away to tell them it wasn’t me,” he told Byline Times. “I was panicking but it all seemed straightforward. The bank told me to call Action Fraud and that it would be reported to other banks that my identity had been stolen. I thought I had nipped it in the bud – until another two banks called and I had to go through it all over again”.

By this point, Phil was getting increasingly stressed, and the lack of communications from the various banks was making his situation worse. But his ordeal was not yet over. He started to receive demands about a loan that the fraudsters had put on a popular credit card. 

“The loan company was very aggressive on the phone,” Phil explained. “They told me if I was lying about fraud then I would be in a lot of trouble”.

Phil’s credit score took a severe hit due to the identity theft. “That was stressful, as I needed to buy a car,” he told Byline Times. “It does seem to be sorted now, so I am hoping it won’t have an impact when I have to redo my mortgage”.

He also feels angry at the way he was treated, while the entire experience was isolating. Because he has had health issues in the past, he explained how “I kept it to myself as I didn’t want to worry my folks. So it was all on my shoulders which wasn’t great”.

The MPs’ report notes that “fraud can have a devastating and long-lasting effect on victims who not only have to deal with financial losses but the emotional and psychological distress”.

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An Evolving Crime

More and more fraud takes place online, with policing failing to keep up with emerging technologies used to scam people out of their money. The report states that Action Fraud “is not sufficiently resourced to deal with the growing and varied challenges it faces”.

Mark Steward of the Financial Conduct Authority (FCA) told MPs that the growth of digital techniques for perpetrating fraud represents the “single biggest change in the shape of fraud we have seen” and this poses a “new and very difficult” phenomenon to deal with.

For this reason, the committee calls on tech companies to play a role in tackling fraud, recommending they “design fraud out of their systems and stop the continued growth of online fraud”.

The committee also identified that people often do not know where to report fraud, or how to report. Often people feel embarrassed or ashamed that they have been scammed. Lottie advises people “not to suffer in silence. Anyone can be susceptible to scams, especially as they are becoming more sophisticated. Even the most careful people can be caught out”.

“We need the criminal justice system to have the resources and focus to be able to adapt to new technologies and emerging trends,” said Neill. “The current sense of inertia cannot continue, we need meaningful action now”. 

If you have been a victim of fraud, contact Victim Support for free, confidential support.