For some time there has been a general feeling held by public and private sector fraud practitioners that the issue of fraud in the UK was not treated as seriously as it should. Campaigns by bodies such as the Association of Chief Police Officers (“ACPO”), the highly successful regional fraud fora and many others, have gradually raised both the public and the Government’s awareness of the serious threat that fraud is to individuals, organisations and the economy as a whole. As a result the Government commissioned a 2006 Fraud Review following which in 2008 the Attorney General’s office ring fenced a budget of £29 million to establish a National Strategic Fraud Authority (“NSFA”). Somewhere along the line the new body changed its name to the National Fraud Authority (“NFA”) with a dedicated website at: http://www.attorneygeneral.gov.uk/nfa
There has been little news in the ensuing period concerning the NFA’s activities. Appointments of interim and permanent chief executives were well advertised as with all political posts. One of the first outputs seems to be a survey of the level of fraud in the UK that was published in January 2010. It was this survey that announced that fraud cost the UK some £30.2 billion per year that reminded me of the NFA’s existence and made me wonder what they were currently doing to help deal with the problem of fraud.
It does seem that one of the Authority’s tasks is to roll out details of the progress that they are making together with the general anti-fraud message at various relevant gatherings around the UK. These include speaking slots at the different Fraud Fora events that are held around the country. Therefore it was with much interest that the North West Fraud Forum’s annual conference was attended on 11 February 2010 at the DeVere Whites Hotel in Bolton.
Two out of three talks during the morning session were related to the NFA. However, the very first talk was on a different subject – an interesting piece by Lancashire MP Rosie Cooper, who related a personal experience of identity theft fraud. The talk highlighted the weak and ineffective response the authorities have historically made to reports of such fraud and Rosie and the audience (which included over 100 respected public and private sector fraud practitioners from around the UK) eagerly awaited the NFA’s report as to how their new thrust would help frustrated victims of fraud like Rosie.
Unfortunately the NFA’s chief executive Dr Bernard Herdan could not make the conference and a last minute substitute of his colleague Cordia Lewis was made. Cordia was an Australian librarian with an MBA. She began her talk be reiterating private sector fraud statistics that had been compiled by the leading accountancy firm KPMG.
Her speech included details of the NFA’s intention to compile a regular Annual Fraud Indicator and an update of the newly established fraud reporting functions of “Action Fraud” for individuals and SMEs or the “National Fraud Intelligence Bureau” for larger organisations and fraud regulators.
Her message was – that if Rosie had experienced identity fraud now she would be able to report the matter to Action Fraud. However, this caused a storm of response from the audience with questions along the line of “do we stop reporting fraud to the police?” and “is this not another level of beaurocracy being inserted into the system?”
The next speaker had a recent example of how the reporting process worked. Detective Superintendent Steve Clarke of the City of London Police headed up one of this squad’s six fraud groups and which was also the lead force in the coordinating the efforts of the NFA. He also headed up the NFA’s National Fraud Intelligence Bureau – the reporting point for major frauds. Steve related the case of Focus Clothing which the City of London is now investigating. This case which has been in the news resulted from over 50 calls to the NFA’s fraud helpline from individuals who had not received goods they had bought online from Focus.
It does seem that there is a lot of talk and good intentions from the NFA but certainly the audience at the North West Fraud Forum were not convinced that reporting a fraud to them would result in any more action than if the fraud was reported to the police or other front line fraud regulator. I discussed the matter with a solicitor, a government company inspector and a private sector fraud investigator all on my table at the conference. Together with my own views as a forensic accountant specialising in fraud matters, the consensus was that the £29 million would be better spent on funding more dedicated fraud squad officers in the various regional police forces! Only time will tell.
By: Mark Jenner – Forensic Accountant