Will Fraudsters Get the Raw End of the Deal?

Fraud is a massive problem, not only in the UK and USA but in most of the leading countries also. The fight against fraud needs to be stepped up, but the trend is to reduce public expenditure these days. This not only impacts agencies such as the police but also the fraudsters themselves will be feeling the pinch!

The question is - will this mean an even bigger rise in the level of fraud is coming? If the regional economic crime squads employ fewer police officers and agencies such as SOCA are broken up, will the fraudster have less to fear when contemplating his next target. Even the Department for Business Innovation and Skills is significantly reducing the amount spent policing limited companies - meaning that all those businesses set up to defraud large numbers of the population are set to flourish.

The trouble is that when frauds come to trial they run up huge Legal Aid costs for the fraudster. All their legal costs, which in a complex fraud can amount to £100,000s, even several £millions, when all the barrister, solicitor and expert witness costs are taken into account. It seems that along with the funding for the regulators, Legal aid is set to be significantly cut also.

On the face of it this seems to be fair. The authorities cannot afford to investigate or prosecute as many frauds - but if you do get caught you will not be allowed a comprehensive defence using the best legal and fraud experts available. Quid pro quo? A better opportunity but with a bigger risk.

The problem is likely to be the way in which the funding will be allocated. Whereas it will be hard for any fraudster to obtain quality representation owing to the costs involved, the authorities on the other hand will be spending their scarce resources in a way that will produce the most return. This has always been their way, where previously criticisms have been that resources are always spent on serious crime such as murder, rape and dealing drugs. Frauds were often considered too much work for only a single conviction - one police officer could typically spend a year or more investigating a relatively minor fraud, whereas the same resource could result in successful prosecutions for 100s of burglaries or one or more "serious" crimes.

The danger is that the police will investigate the easier frauds, where quick results are possible, leaving the complex frauds alone. This means that businessmen practicing only sharp practice might be targeted - or failed businesses accused of fraudulent trading. With less resources to employ a competent defence team it is possible that access to justice will be denied for the unfortunate businessmen as a result of the funding cutbacks and the clever fraudsters will continue to ply their trade.

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