Does the professional thief and organised criminal have a safe haven in committing economic crimes?
Chair: Dr Janice Goldstraw-White
Richard Hyde – Senior Researcher, Social Market Foundation
Sandra Peaston – Director of Research and Development, Cifas
Rian Matanky-Becker – Head of Economic Crime Policy and Engagement, HMRC
Sandra Peaston opens by pointing out that the Crime Survey for England and Wales for the year ending September 2021 stated that there were 5.1 million economic crime offences reported, a 36% increase from the previous year. In considering why cases are so high, she states that we have created an environment where carrying out fraud and crime is undertaken far more anonymously than before and the digitalisation of the economy, which benefits people through ease of access, also benefits those perpetrating economic crimes. She states that this allows offenders to carry out their crimes on an industrial scale, at the same time hiding their identify, masking where they are and, in some cases, getting others to do their ‘dirty work’. She notes that the number of methods that someone can contact a victim has increased considerably in the last 20 years, where the norm then was a postal scam letter. Sandra believes that when getting others to carry out fraud, the problem is the perception surrounding fraud. She cites recent Cifas research that has shown that many people do not see it as unacceptable, so getting people to be involved or enticing them to be a money mule is not difficult. She feels that individuals fail to realise what they are doing, where the money is going, and what it is financing. Finally, she points out that also one of the reasons for higher crime figures is that the stigma of being defrauded is lessening, and this has led to a greater acceptance that anyone can become a victim of fraud and resulting in people being far more willing to report a fraud.
You will hear Richard Hyde talk about recent research that he has been involved in with the Social Market Foundation (SMF), where they have highlighted the inadequacy of police resources dedicated to tackling fraud. He outlines that this is of no surprise, as the HMIC came to similar conclusions in their 2019 report, and the recent Barber Review on Strategic Policing suggests that only 0.1% of frauds that take place, result in a charge or summons. Added to that situation, he states that convictions have fallen significantly. He, therefore, suggests there is not much risk to the offender committing fraud. Richard points out that one of the gaps in tackling fraud, highlighted by their research, was that fraud is often thought about in silos and its interconnections with other crimes, such as cyber, organised crime, and money-laundering is often overlooked. He states that a whole host of domains from individuals, policymakers and the public sector for example, need to work together to achieve more than they would be able to on their own. In pointing out what needs to change in the current approach, Richard advocates a systems-based approach and SMFs research identified 10 domains which were seen as the foundations of what was needed to be put in place to tackle fraud. But to succeed he says it will require leadership from the very top of Government, supported by a strong governance structure to drive this forward and monitor performance. But he cautioned as the police are already over stretched, this is not just about redistributing resources, but significantly adding to them.
We hear from Rian Matanky-Becker how the HMRC are tackling tax crimes and frauds, money-laundering and associated offences. She states that she did not entirely agree that economic criminals have a safe haven in the UK, and that the HMRC have a strong track record of performance to back this up. She outlines that in the past five years they have initiated 100,000 civil cases, more than 4,300 criminal investigations, securing and protecting more than £28 billion for UK public services and achieved more than 3,800 criminal convictions. She explains that the HMRC has recovered £1 billion of criminal assets to put back into the exchequer, and they have been able to make use of new tools and powers, such as Account Freezing Orders which totalled 229 last year and securing £34m. Rian also points out that the HMRC are also improving performance and that they are now recovering double the amount of assets under the Proceeds of Crime Act than they were five years ago, and also supervisory interventions have increased from 1400 in 2019 to over 3700 over the last financial year. However, Rian points out that these successes have to be read alongside the scale of the problem as a whole, and although she states that looking across all crime types the Crime Survey revealed that only 7% resulted in a charge overall, she outlines that there are particular factors that make economic crimes more challenging, both conceptually and practically. In summary she emphasises the importance of working in collaboration with others, but she feels more fundamental changes may be required to tackle this issue.
This webinar has once again highlighted that although there is some good work being undertaken to tackle economic crime, we do indeed generally have an environment that enables offenders to commit such crimes quite easily, and that when they do, their chances of being caught, and even more so, successfully prosecuted, is very slim. With the rising number of economic crimes being committed we can no longer allow this situation to continue, therefore, we need to radically rethink how to tackle these offences, including changing the narrative that it is not seen as socially acceptable. Whereas some organisations are making some progress in this area, we are still working too much in silos, constrained not only by funding and the correct structures to carry this out, but a real commitment from the Government to tackle this dominant crime area.
Dr Janice Goldstraw-White
21st April 2022