Understanding the characteristics of serious fraud offending in the UK

By Michael Skidmore and Beth Aikenhead

This study aims to improve our understanding of the most serious fraud offences perpetrated in the UK, specifically the diversity of methods for committing these crimes, the characteristics and pathways of offenders involved and where applicable, how the groups or networks of offenders operate. This is an exploratory study which used qualitative data taken from the documents compiled by police practitioners in 25 separate criminal investigations. The cases included in this analysis do not constitute a representative sample of frauds in England and Wales during this period. The selection of cases reflects the choices made by the research team to incorporate a diversity of methods, offenders and settings to capture the breadth of fraud. Furthermore, the sampling frame is the product of practitioner choices over which crimes to assign investigation by specialist teams; these are a limited resource and due to the challenges of international investigation, will likely prioritise offending that has a footprint in the UK. Furthermore, in focusing on frauds that were perpetrated (at least in part) from within England and Wales it does not represent fraud offending that emanates from other countries. The specific fraud cases were serious for different reasons; high financial losses (£100,000 or more), high volume offending (50 or more known victims) and high victim impact (assessed by the victim and/or police practitioner). These dimensions of harm reflect those used in practitioner assessments for deciding which frauds are high harm and a priority for intervention. Only three cases satisfied all three harm criteria, all of which involved the mis-selling of investments. Twelve cases satisfied only one criterion and those linked to each dimension of harm were associated with different methods and victims; all cases that fulfilled the high financial loss criterion had defrauded businesses, and two out of three that fulfilled the high-volume criterion involved taking advance payment from consumers In five cases the scale of victimisation and impact was hidden, but they were included because they involved high-risk offenders suspected of being engaged in serious and complex offending. There was considerable diversity in the methods for perpetrating serious fraud and this study borrows from a typology of acquisitive crime developed in a previous study (Naylor, 2002). This model provided a good fit for distinguishing serious frauds on the basis of two overarching models of offending, and this delineation simultaneously revealed distinctions in the situational context, victim and offender profiles: • Commercial frauds: perpetrated from within a legitimate or pseudo-legitimate business setting and included the sale of investments or the mis-selling of products or services online or face-to-face, and nearly all had victimised individual members of the public. • Predatory frauds: involved theft by impersonating legitimate individuals or organisations, mostly by offenders operating from outside of a business setting and without the pretence of a legitimate commercial exchange. The victim profile was more varied, and over half had victimised businesses (for example, payment diversion fraud). There was divergence in the types of fraud offence encompassed by each category of fraud.

London: Police Foundation 2023. 39p.