With immediate effect, the National Fraud Authority (NFA) – the Government’s lead body for combating fraud across both the public and private sectors – has been transferred from the Attorney General’s Office to sit under the jurisdiction of the Home Office as an executive agency.
It’s hoped that this decision will help strengthen the UK’s ability to thwart fraudsters by ensuring a more co-ordinated approach and building even closer links between the NFA’s own work and the wider fight against organised and cyber crime.
As well as building a much clearer picture of the scale of fraud in the UK since its launch back in 2008, the NFA has made significant progress in tackling this insidious and hugely damaging form of criminality.
That progress includes last year’s creation of Action Fraud (the national fraud reporting centre which provides advice, guidance and a means of reporting for victims of fraud).
The NFA also updates the Annual Fraud Indicator to provide a more comprehensive assessment of the harm caused by fraud.
On that note, the NFA will continue to run Action Fraud as well as working closely with the Cabinet Office on a programme of work aimed at reducing levels of fraud across the public sector.
Steering the efforts of the counter fraud community
The Attorney General, the Rt Hon Dominic Grieve QC MP, commented: “Under the sponsorship of the Attorney General’s Office over the last two and a half years, the National Fraud Authority has made significant progress in steering the efforts of the counter fraud community to fight economic crime more effectively.”
Grieve added: “We now have a much improved estimate of the scale of fraud in the UK, plus comprehensive programmes of activity tackling fraud in both the public and private sectors. Through Action Fraud there is also a single point of contact for every individual to report fraud and get the advice and support they need as well as gain a thorough understanding of the fraud landscape.”
In conclusion, Grieve explained: “In transferring to Home Office sponsorship, the NFA will be even more effectively placed to influence this significant element of the crime agenda.”
The Attorney General’s Office provides high quality legal and strategic policy advice and support to the Attorney General and the Solicitor General (the Law Officers).
The Attorney General is chief legal adviser to the Crown, is a minister of the Crown with responsibility for superintending the prosecuting departments and has a number of independent public interest functions.
The Attorney General also holds the separate office of Advocate General for Northern Ireland. The Advocate General for Scotland is the UK Law Officer with specific responsibility for Scottish law matters.
GB pound 38 billion cost of fraud
Fraud costs the UK around GB pound 38 billion every year, and can have serious consequences for individuals, businesses and public services alike.
Home Secretary Theresa May commented: “Fraud can have devastating consequences and is often used to fund serious crimes, such as terrorism, drugs and human trafficking. The Government is determined to give greater focus to tackling both serious and economic crime.”
May welcomes the move of the National Fraud Authority to the Home Office, as does minister for the Cabinet Office, Francis Maude.
“By setting up our own Counter Fraud Champions we have shown that we will not tolerate fraud,” explained Maude. “The latest National Fraud Authority estimate reveals GB pound 21 billion of fraud against the public sector and, contrary to what many people think, fraud and error isn’t just confined to benefits and revenue.”
Rather, fraud affects every Government department and impacts on the Government’s ability to deliver better public services, while also stripping the civil service of vital resources.
“The new network of Counter Fraud Champions, based in all major Government departments, is helping to strengthen the fight against the massive amount of fraud and error in the public sector,” added Maude.
“The Government’s Counter Fraud and Error Taskforce initiatives are already showing success in reducing fraud levels, and I look forward to continuing to work with the National Fraud Authority to further strengthen our anti-fraud measures across Whitehall and the public sector.”
Further details on the transfer and the ongoing work of the FSA can be found on the website (a link is provided on the right hand panel of this page)
GB pound 23.5 million lost to investment frauds reported to Action Fraud
GB pound 23.5 million was reported stolen to Action Fraud over the past financial year through share sale or boiler room fraud. The average loss reported by a victim is GB pound 122,000, with the highest single reported loss at GB pound 8 million.
With a new financial year about to begin, it’s important to remind potential investors how to protect themselves from these types of fraud.
A share sale or boiler room fraud happens when fraudsters cold call as many people as possible to persuade them to invest in shares that are either non-existent or so worthless they are impossible to sell.
The fraudsters may provide false share certificates and other documents to make the investment seem credible. Once they’ve taken as much money as they can, these fraudsters then disappear.
GB pound 80 million boiler room fraud detected
Earlier this month, following on from a joint investigation between the City of London Police, US and Spanish authorities, one of Britain’s biggest fraudsters pleaded guilty to an GB pound 80 million boiler room fraud that accounted for at least 2,300 victims across the UK.
The City of London Police, which is the national lead force for fraud, leads the way in combating boiler room fraud, running major investigations in partnership with law enforcement agencies across the UK and abroad.
Here are some tips on how not to be a victim of share sale fraud:
- If you’re considering any type of investment, always remember: if it seems too good to be true, then it probably is. High returns can only be achieved with high risk.
- Legitimate investment schemes and stockbrokers do not cold call you – only deal with professionals you know…
- If you’re suspicious about a scheme’s authenticity, you should investigate the company’s status and contact details.
- If you suspect fraud has been committed, report it to Action Fraud immediately
Fraudsters know what they’re doing
Dr Bernard Herdan, CEO of the National Fraud Authority, said: “The deals these fraudsters are offering are always too good to be true. Unfortunately, they know what they’re doing. They call people out of the blue and sound professional. They pressurise you into making a rush decision through hard sell techniques. Even experienced investors are tricked into making investments.”
Herdan added: “Fraudsters aim to make their business seem legitimate so they will often use technical jargon, impressive job titles and mock websites to appear credible. Some of the largest losses that Action Fraud has recorded were from people who have been duped by share sale fraudsters.”
Commissioner Adrian Leppard from the City of London Police stated: “Boiler room fraud continues to ruin lives and deprive UK plc of hundreds of millions of pounds of investment. This is a deeply destructive crime that sees some of the most ruthless criminals preying on some of the most vulnerable in our society.”
In conclusion, Leppard said: “We strongly advise not to invest money as a result of being cold called – no matter how attractive the opportunity appears to be. Once you let a boiler room fraudster into your life it’s very difficult to get them out until they have taken all your money.”
For more advice or to report a fraud visit www.actionfraud.org.uk or call 0300 123 2040. Action Fraud is run by the National Fraud Authority and takes a full crime report from victims of fraud. It also provides individuals and small businesses with advice about how to protect themselves becoming victims of fraud.
What should you do if you’re a victim of share sale fraud? Some further advice…
- Report it to Action Fraud
- Break off all contact with the fraudster at once
- Alert your bank immediately if you’ve given the fraudsters your bank account details
- Keep any written communications you’ve received from the share sale fraudsters. This may help you give evidence to the authorities
- Because many boiler rooms are run from abroad, they’re not covered by UK jurisdiction or compensation schemes. Therefore, you’re unlikely to recover any lost investment.
- Be aware that you are now likely to be a target for other frauds. Fraudsters often share details about people they have successfully targeted or approached, using different identities to commit further frauds
- People who’ve already fallen victim to fraudsters are particularly vulnerable to the fraud recovery fraud. This is when fraudsters contact people who’ve already lost money through fraud and claim to be law enforcement officers or lawyers. They advise the victim that they can help them recover their lost money – but request a fee
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