On Thursday 10 February, the House of Commons Library published a briefing paper on economic crime in the UK, which summarises recent research, analysis and Government action. This is short, and well worth a read in full for its overview of how things stand in three key areas: the scale of economic crime; government action; and current issues.
In particular, we thought it was interesting that the briefing highlighted:
Scale of economic crime
- The extent of economic crime in the UK can reasonably be said to run into the tens of billions of pounds, and probably the hundreds of billions, but despite all the efforts to combat it, it is said to be “rapidly growing”.
- Serious and organised crime, much of which is economic in nature, is estimated to cost the UK £37 billion a year.
- The UK’s overall approach to addressing economic crime issues was set out in its Economic Crime Plan 2019 to 2022 (the ECP). This set out seven strategic priorities, with 52 specific actions.
- As of 7 February 2022, 40% of these actions were completed; 32% were in progress; 23% were overdue and 3% had no due date. The Government is apparently on course to deliver 49 of the 52 actions by the time the ECP expires later this year.
- The recent Treasury Committee report on economic crime recommended that the ECP should be adapted and renewed for a further three years.
- However, the ECP has been criticised for, among other things, failing to address areas such as corporate criminal liability (very much the topic of the moment in this area) and the capability of the UK authorities to enforce existing laws and fight economic crime at an operational level.
- The first payments under the economic crime levy – which forms part of a more “sustainable resourcing model” for tackling economic crime – are due to be paid in the 2023/2024 financial year. It will be interesting to follow the impact of this attempt to better fund anti-financial crime efforts.
- Plans to launch a public beneficial ownership register for UK property could be included in the Economic Crime Bill, which the Government has committed to bring forward in the 2022/2023 parliamentary session. This chimes with comments made by Kevin Hollinrake MP, on which we recently commented.
- Criminals successfully stole £1.2 billion from individuals through banking fraud and scams in 2019. Businesses and the public sector are estimated to lose around £5.9 billion from fraud per year.
“The precise scale of economic crime in the UK is unknown, but it could run to tens or hundreds of billions of pounds per year. The extent of these crimes – which include money laundering, fraud and corruption – led the Intelligence and Security Select Committee in its July 2020 report on Russia to note that London is considered a ‘laundromat’ for corrupt money.”