Government does not know the full scale of the fraud threat to
individuals and businesses and is not yet leading an effective
cross-government strategy to tackle it, according to the National
Audit Office (NAO).
The Home Office is responsible for preventing and reducing fraud.
It does so in partnership with many bodies including the National
Crime Agency (which hosts the National Economic Crime Centre),
the City of London Police Force (the national lead force for
fraud), other government departments, the finance, technology and
telecoms sectors, and international partners. Around 80% of fraud
offences in the UK are enabled through computer technology,
including by criminals who can operate remotely anywhere in the
world.
In its 2017 report Online fraud, the
NAO concluded that fraud had been overlooked by the government,
law enforcement, and industry, and demanded an urgent
response.1
Since then, the threat from fraud has increased and
evolved but the number of fraud offences resulting in a charge or
summons has fallen. Crime figures show that fraud was
the largest category of crime in England and Wales in the year
ending June 2022 - amounting to 41% of all crimes against
individuals, compared to 30% in the year ending March
2017.2 While bank and credit card fraud are still the
most common, other forms of fraud, such as advanced payment
fraud, are increasing rapidly. The estimated number of incidents
of actual and attempted fraud against individuals in England and
Wales rose by 12% from 3.4 million in the year ending March 2017,
to 3.8 million in the year ending June 2022. However, the number
of fraud offences resulting in a charge or summons fell from
6,402 in 2017 to 4,816 in 2022.
There are still significant gaps in the Home Office’s
understanding of the threat from fraud. Based on 2015-16
data and in 2015-16 prices, the Home Office estimates that the
cost of fraud to individuals is £4.7 billion - it does not have
any reliable estimate of the cost of fraud to businesses. The
Home Office also has a limited understanding of who commits fraud
and those who enable it by their action or inaction.
The government has launched different strategies covering
fraud and economic crime but has not yet established what
outcomes it wants to achieve.Strategies have covered a
range of topics including cyber security, anti-corruption, and
serious and organised crime, making it challenging for the Home
Office to focus and coordinate the activities of
partners.3 The Home Office was solely or jointly
responsible for five actions related to fraud in the 2019
Economic Crime Plan, but these were expressed as activities or
aspirations, rather than outcomes. In April 2021, the Home
Office announced plans for a Fraud Action Plan to set a national
approach between 2022-2025. However, in March 2022 government
instead announced plans for a new Fraud Strategy, building on the
initial development of the Fraud Action Plan. The Fraud Strategy
has not yet been published.
The Home Office has limited influence over many of the
organisations required to successfully combat fraud. Addressing
the threat of fraud depends on the Home Office building
relationships with a wide range of partner bodies and influencing
the behaviour of the public and businesses. Its relationships
with partner bodies vary in maturity. There can also be tensions
in what the Home Office is expecting partners to do, for example
the steps it asks the private sector to adopt to prevent fraud
can slow down the customer journey.
The Home Office does not understand the full extent or impact of
resources dedicated to combatting fraud. In 2017, the NAO found
that the Home Office needed to improve the way it measured its
work on fraud. It still does not have a complete picture of what
is being spent on tackling fraud by its partners in the public
and private sector, or how effective this spending is. It has
however made some improvements to its collation and monitoring of
fraud data. The Home Office is in the relatively early stages of
working more closely with international partners on fraud - it
has a limited understanding of the international response, and
how the UK’s response compares to other countries. Without a
better understanding of the impact its policies are having, the
Home Office will not be able to prioritise or adapt its approach.
, the head of the NAO,
said:
“Five years on from our last report on this subject, the
Home Office has taken limited action to improve its response to
fraud. Its approach has lacked clarity of purpose, it does not
have the data it needs to understand the full scale of the
problem, and it is not able to accurately measure the impact of
its policies on this growing area of crime.
“For its planned Fraud Strategy to succeed, the Home
Office must be vigorous in leading a cross-government response
that is informed by a thorough understanding of what works in
combatting fraud.”
Notes for Editors
- See the NAO’s report Online fraud (June
2017).
- The 2022 crime figures compare the year ending June 2022,
with years ending in March in previous years. See Crime in England and
Wales: year ending June 2022
- The different government strategies covering fraud and
economic crime are: The United Kingdom
Anti-Corruption Strategy 2017-2022; The Serious and
Organised Crime Strategy (2018); The Economic Crime
Plan 2019-2022, and its statement of
progress, and The Beating Crime
Plan (2021).
