UK unveils fraud review

LONDON – An ongoing UK cross-government review of fraud set for release in April 2006 will investigate the scale and costs of fraud throughout the UK. The Fraud Review will identify available data and gather further data on prevalence and trends of fraud offences, the economic costs of fraud and the current government response to fraud. The review will include analysis on emerging issues and patterns in fraud such as global sharing of bank data by personnel at Indian call centres.

According to the attorney general Lord Goldsmith QC: "Modern technology allows fraudsters to commit bigger and more widespread crimes, often of global proportions. Every year it costs the UK economy the equivalent of £230 for every person in the UK. It cuts across multinational corporations and is embedded in terrorism, human trafficking and drug smuggling. It also affects individuals through credit card fraud and ID theft."

Fiona MacTaggart, parliamentary under-secretary at the Home Office, says: "Our criminal justice system needs to deal effectively and fairly with all kinds of crime. But too often in the most serious and complicated frauds it fails, and trials collapse with the result that no-one is brought to justice and the taxpayer has to meet substantial costs…it is not right that the greater the scale and complexity of the fraud the less likelihood there is of a successful prosecution."

The review is specifically intended to measure the scale of fraud in the UK, the appropriate role for government in dealing with fraud and how resources could be best spent to maximise value-for-money across the system.

According to a Treasury spokesperson: "One of the most difficult issues concerning fraud in the UK has been that we do not know how large a problem it is. If we do not know how to quantify the problem it is very difficult to know if you are controlling it."

Fraud has been estimated to cost the economy at least £14 billion a year in stolen assets, lost revenues, the costs of prevention and investigation.

In May 2005, the government introduced the Fraud Bill, which included new measures for modernising the law to equip investigators and prosecutors with the necessary tools to keep pace with the changing world of fraud, including new threats such as phishing (sending an email to a user falsely claiming to be an established legitimate enterprise in an attempt to scam the user into surrendering private information that will be used for identity theft) and other internet fraud.

An interim report of the Fraud Review is set for January 2006 and a final report for April 2006. OR&C