UK Publishes New Fraud Strategy for 2023

On May 3, 2023, the UK Government published its new fraud strategy, setting out over 50 measures to reduce fraud and cybercrime by 10 percent by 2025. The Home Office said the strategy would “establish a coordinated response from the government, law enforcement, and the private sector to better protect the public and increase the disruption and prosecution of fraudsters.”

The strategy speaks to one of the main objectives of the Economic Crime Plan 2 – to ‘cut fraud’. To reach this goal, the strategy revolves around modernizing the response to fraud using leading practices, tools, and technology. Additionally, the government will work with public bodies and ministerial departments to improve their understanding of the risks they face.

The UK’s Most Commonly Experienced Crime

Accounting for 41 percent of all crimes committed nationwide, fraud is the most commonly experienced crime in the UK. As suspicious activity report (SAR) intelligence continues to highlight the growing scale of certain fraud types, in February 2023, the government announced that fraud would be reclassified as a national security threat, giving it the same status as terrorism. 

The government’s strategy also highlights numerous statistics that highlight the endemic nature of fraud in the UK:

• £2.35 billion lost by victims in 2021.
• 64 percent of UK businesses experienced fraud, corruption, or other economic crime in 2022.
• 18 percent of victims were scammed more than once in 2022.
• Less than one percent of police resource is assigned to tackle fraud. 
• The total cost to society in England and Wales was estimated to be at least £6.8 billion in 2019-20.

To improve the response of law enforcement, intelligence, and the criminal justice system, the government said it is investing £100 million, part of the £200 million announced in the 2022 spending review. The government will invest this over three years alongside the £100 million a year Economic Crime (Anti-Money Laundering) Levy, allocated for anti-money laundering (AML) purposes.

Key Actions

The government’s key actions are underpinned by the strategy’s three pillars: pursue fraudsters, block fraudsters, and empower the public. The strategic measures outlined in the report include:

• Establishing a National Fraud Squad with over 400 new specialist investigators.
• Creating a new UK Intelligence Community (UKIC) Cell and moving to intelligence-led disruption.
• Replacing Action Fraud with a state-of-the-art reporting system.
• Leading a partnership to pursue fraudsters worldwide. 
• Stopping criminals from abusing the telephone network by:
  • Banning cold calls for all financial products.
  • Banning SIM farms.
  • Stopping more spoof calls.
• Making the tech sector commit to protecting its customers through legislation and voluntary commitments. 
• Making it easier to report fraud on social media and the internet. 
• Helping banks slow down suspicious payments.
• Publishing information about fraud levels on different platforms. 
• Supporting and reimbursing more victims. 
• Facilitating better communications about how to report fraud. 

Key Takeaways

When reviewing the strategy, compliance staff should take note of the case studies featured throughout the document in grey boxes. These studies help contextualize various fraud types and indicate red flags that may help inform new or updated transaction rule sets. Firms should ensure these scenarios can be effectively detected by their anti-fraud tools and that future risks can be projected to help compliance staff anticipate threats.