The Fraud Epidemic

Not mysterious like Money Laundering or dangerous like Terrorist Financing, Fraud has always been deceptive but lately has also been Mr. Popular.

It started as something you’d hear happened to someone, a Nigerian Prince scam or an Indian social security scam. On the white collar side you just had to wait a few weeks for the next big corporate scandal involving some type of fraud. But it’s trickled out, down and around. Recently, I’m sure you’ve noticed the relaxed attitude to theft (from petty to full on daytime robbery) in shops and supermarkets. Gone are the days when teenagers would mastermind a heist to walk out of a shop with some nail polish and sweaty palms. Now we have these acts brazenly recorded on phones and shared online for the world the see, we have individuals walking into shops with nothing but their empty bags and sheer audacity, then walking out with racks worth of items daring someone to stop them.

In London we have to think twice before pulling out our phones in certain parts of town because bicycles are no longer the quirky forms of transportation they once were.

In the past few years you've also experienced the rise of online scammers and grifters from the stock and crypto markets to sham sales and services, (the governments in their own ways), and everyone in-between. It seems a particularly new gap has been created in response to our peculiarly new world, and the faster we try to close that gap with regulations the bigger it gets.

2023's Economic Crime and Corporate Transparency Act’s Failure to Prevent Fraud offence sought to further close that gap by putting more pressure and onus on institutions, it was no longer ok to just attempt to prevent and report fraud - it is now an offence not to take the recommended steps to preventing it. The thing is, many institutions already had a lot of the recommended steps in place because they overlap with other FinCrime regulations, and it still did nothing to stop the 2024 13% increase in reported fraud cases compared to 2023.

The Financial Crime Authority’s 3-year Economic Plan/Fraud Strategy (to stop Scams and Protect the Public) has been active since 2023 and due to should expire in 2026, its effects so far are arguable when we consider our real-life experiences and the actual statistics.

Even with the enhanced emphasis on data protection, legal requirements for institutions to adhere to GDPR and DPA guidelines, identity fraud remains the most prevalent case type, with almost 250,000 identity fraud filings recorded in 2024 (accounting for 59% of all fraud filed cases to the National Fraud Database), an increase of 5% compared to 2023. (It is important to note that the survey figures only represent the fraud crimes reported, and just reported to the NFD).

As the internet continues to expand possibilities, remote based sectors like E-Commerce, FinTech, EdTech, RegTech etc. will continue to grow, easier access to the platforms and the resources they offer will continue to spread, and it is inevitable that so would the risks for everyone involved. The gap will inevitably continue to grow until the real problem is addressed. Until institutions stop relying solely on generic guidelines.

With a legal background I respect and appreciate the Law, its rules and regulations probably a little more than the next person, but there is only so much staying updated with regulations can do and at some point, each institution will need to have a look in the mirror and have some tough but necessary conversations with itself to normalise new practices for a new age, not just themselves also the users of their services. 

Life isn’t one size fits all, Law isn’t one size fits all (if you know you know), so why should your solutions be?

Fraud is impacting you and your organisation.

To strengthen your personal and commercial defences with tailored solutions, I welcome the opportunity to connect.

JOA Solutions Clarity Compliance. Confidence.