Government Launches Anti-fraud Charter

on November 18, 2021

Fraud now represents over a third of all UK crime. Retail banking, telecoms firms and professional accountancy bodies in the UK have each voluntarily signed charters–without any sanctions– to do more about fraud in the next couple of years.

The proportion of fraud that involves an accountant or the accountancy sector may be small however, the role that an accountant plays can be important. The charter sets out a list of actions that the Government and the accountancy sector can deliver in partnership to close the following vulnerabilities that fraudsters may exploit.

One of the long-term goals of the joint fraud taskforce is to produce a fraud toolkit. This toolkit includes advice and guidance to accountants on current fraud risks, checks they can undertake to help identify potential frauds and where to signpost victims to for support.

The accountancy sector is hugely diverse, featuring qualified and unqualified accountants, 13 professional bodies (with non-members being required to register with HMRC for money laundering supervision) and firms ranging in size from major global firms to sole practitioners.

As a result, the types of fraud each accountant encounters will differ, as will the resources and training available to them to identify and prevent fraud.

The Government will commission an accountancy sector fraud intelligence brief that identifies major fraud risks. The accountancy sector and law enforcement will work together to ensure that relevant threat information is shared between law enforcement and the sector consistently. The Government will consider whether further actions are required to address fraud risks in the sector based on the intelligence brief. It will also work on measures to improve the reliability of Companies House data. The current statutory role of the Companies House registrar is limited in terms of checking or querying information on the register. This may allow financial statements to be filed fraudulently using the details of an accountant without their knowledge.

To complement the ongoing Companies House reforms, the Home Office will work with BEIS, Companies House and the accountancy sector to ensure an open dialogue for the purposes of suggesting Companies House enhancements.

Similar charters have been published for retail banking and telecommunications sectors. As for telecoms, the charter (signed by seven telcos) speaks of data on sources of scam calls to be shared by the industry. The Government encourages the public to forward suspicious text messages to 7726 (which is free of charge) and continues to encourage anyone who has been targeted by a scam to report it to Action Fraud. So, the 7726 database can be used more for data sharing against smishing. For example, telecoms firms will look to identify repeat fraudsters, and to pass ‘actionable evidence’ to the police.

The Taskforce and charter agreements form part of the Fraud Action Plan framework agreed at the Government’s Economic Crime Strategic Board earlier this year. Their establishment builds on the Government’s wider work to tackle fraud.

For the 2020 Spending Review, the Government committed £63m to the Home Office to tackle economic crime, including fraud. This is in addition to the funding that the Home Office commits each year to the National Economic Crime Centre in the NCA, and police forces, including over £15m each year to the City of London Police as the national lead force for fraud.

It remains vital that victims continue to report fraud to the police through Action Fraud whilst a new improved system is delivered: Action Fraud

Written by Irina Stucere

Filed under  Blog • Business Advice • Tax 

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