Hard to police: cash seized from a lorry driver caught smuggling money out of the UK in 2016. Image: HM Revenue & Customs / Wikimedia Commons / CC BY 2.0
The policing response to economic crime is not fit for purpose, and money launderers and fraudsters operate with impunity – but evolution and not revolution is the answer.
Despite the valiant efforts of an under-resourced law enforcement contingent and a commitment in the UK government’s Economic Crime Plan (2019–2022) to ‘strengthen the capabilities of law enforcement … to detect, deter and disrupt economic crime’, the policing response to economic crime is not fit for purpose: money launderers continue to launder with impunity, and fraudsters rarely face retribution.
There are, however, some green shoots. The National Economic Crime Centre (NECC), established in 2018 to better coordinate the law enforcement response, has started to bring cohesion to the response. The City of London Police (CoLP), the lead police force for economic crime, is in the process of upgrading the ‘Action Fraud’ service and is bolstering the operational response via investment in the network of Regional Economic Crime Units (RECUs).
Laudable as these efforts are, it is widely recognised that they are not enough to deal with a problem of this scale. And although the ‘more resources’ mantra is part of the response, this in isolation will only provide part of the solution. However, to date, viable proposals based on the real-world realities of policing economic crime have remained elusive.
Until now. Since May 2022, the Centre for Financial Crime and Security Studies at RUSI has convened a group of experts from operational policing, academia and civil society to start building a blueprint for the future, from which some clear principles for reform have emerged.
A key finding of the group is that the response most critics of the current system reach for (examples here and here) – the creation of a single economic crime force – while intuitively appealing, may in fact cause more issues than it solves, by creating unnecessary operational silos from interlinked crime threats, divesting policing of its responsibilities in this field and duplicating specialist policing capabilities which work well at the regional tier (as well as disrupting the progress made so far).
Economic crime is a volume crime on a scale like no other, requiring an industrialised response beyond traditional criminal justice outcomes
So, if a single agency is not the right response, what is? It is here where articulating the problems in the system is key if we are to build the right solutions-based response for the future.
Data-Rich but Knowledge-Poor
Economic crime is a data-rich environment. Whether via Suspicious Activity Reporting, Action Fraud victim data or private sector platforms like Cifas, we are awash with data. Yet this data is not interpreted effectively to define the problem and identify priority targets. The first step must be to exploit the mass of data to create knowledge for better targeting.
With its public-private platform and permissive information-sharing gateways, the NECC is the clear front-runner to take on this system leadership role. Akin to the role of the National Cyber Security Centre in cyber policing (or Mi5 in counterterrorism), the NECC should build out its role as the data analytics ‘brain’ of the ‘machine’, through access to the right technologies and human resources, in order to drive a more strategic focus on prevention via the private sector and to better inform the operational priorities of policing.
A Volume Crime Requiring an Industrialised Response
Economic crime, particularly fraud, is a volume crime on a scale like no other, requiring an industrialised response beyond traditional criminal justice outcomes. Put simply, we can’t arrest our way out of this problem. The approach must one of ‘disruption by any means’ using a mix of industrialised prevention via the private sector and more targeted operational interventions by policing and wider enforcement partners. This concept would work most effectively at the regional tier of policing – the RECUs – and, over time, should evolve the existing capacity from a purely policing response into a network of multidisciplinary, public-private ‘super hubs’ under a single policing lead (ideally CoLP) to drive a proactive, industrialised response.
The Poor Cousin in Policing
Economic crimes underpin serious organised crime; cybercrimes enable fraud. All these crimes intersect with local policing priorities like county lines and human trafficking. Despite the interlinking nature of the threat, economic crime suffers from a disproportionate reduction of resources when belts tighten. There are two solutions to this.
At the local policing level, it is essential that the Strategic Policing Requirement – the framework of priorities against which Chief Constables must deliver – is refreshed to give economic crimes, particularly fraud, greater billing. At the regional tier, we need to stem the bleed by ring-fencing economic crime resources in the RECUs (as an alternative to siloing them away from mainstream policing in a separate agency). Akin to the model of a centrally coordinated, locally delivered policing response to another national security threat, namely counterterrorism, this model has the benefit of retaining resources without losing the essential link to local communities and wider crime threats.
Recruitment and Retention
The skills and resourcing gap in economic crime policing requires a tailored solution that cannot be provided by simply diverting a contingent of the 20,000 new police officers into fraud investigation. Industrialising the response requires a different set of tools and techniques to be developed under a proper workforce strategy.
Despite the growing political pressure to do something about economic crime enforcement, there is a need to be realistic about the availability of new investment
This strategy needs to focus less on warranted officers (though more of these are essential) and more on a broader skills mix of civilian investigators, data scientists, cyber experts and financial investigators. It needs to leverage the capacity and capability of the private sector through a mutually beneficial secondments system. And it needs to tackle retention by finding creative ways to deal with the haemorrhaging of capacity to the better-remunerated private sector, by creating an academically accredited economic crime ‘profession’ to increase attractiveness as a long-term career pathway.
A Growing Problem at a Time of Austerity
Finally, despite the growing political pressure to do something about economic crime enforcement, there is a need to be realistic about the availability of new investment. While the government plans to bring forward an ‘Economic Crime Levy’ on businesses, it will not be enough and cannot be spent on fraud policing.
It is here where the system itself provides the solution: the economic crime enforcement system is a net contributor to the UK Treasury, whether through asset recovery receipts, regulatory fines or deferred prosecution agreements. However, only a fraction of these receipts are reinvested in the system. An ‘economic crime fighting fund’ to strategically recycle a proportion of these returns is appealing, and would create a virtuous circle of more activity generating greater receipts and greater investment.
In conclusion, the answer to the problems of economic crime policing lies in building from the foundations of activity currently in train. Rather than creating one agency, what is needed is to ‘one team’ – a strong central public-private data analytics capability building a strategic response to prevention and informing operational priorities, with operational delivery driven by a centrally directed network of ring-fenced, multidisciplinary regional economic crime ‘superhubs’, with access to a range of capabilities and skills and working to a ‘disruption by any means’ mandate, while retaining a link to local policing.
In short, the solutions many grasp for, such as more cops or a single agency – while intuitively appealing – do not provide the solution to the problem in hand. Though it may be less attractive as headline fodder, the response must be one of evolution and not revolution.
The views expressed in this Commentary are the author’s, and do not represent those of RUSI or any other institution.
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Associate Fellow; Head of Public Policy at Cifas