Evaluating the case for greater use of private prosecutions in England and Wales for fraud offences

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Highlights

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    We have looked at the prosecution landscape as it has evolved recently in England and Wales.

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    We have considered the legal basis for private prosecution for fraud.

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    We have identified reforms to help fill the existing sanctions gap in countering fraud.

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    We have considered the challenges and opportunities for the use of private prosecutions.

Abstract

This paper considers the challenges and opportunities that exist in England and Wales for the use of private prosecutions for Fraud. It considers the need for sanctions against fraudsters: looks at the prosecution landscape as it has evolved, especially during the 21st century: considers the legal basis for private prosecution and gives a brief history of its extent. The advantages and disadvantages associated with private prosecution are considered and recommendations made on the changes needed before there could be significant developments in the use of private prosecutions.

Introduction

This paper sets out to identify reforms to help fill the ‘sanctions gap’ in countering fraud. Special attention is paid to the role that private prosecutions could play in ‘punishing’ fraudsters. Results in this paper are taken from commissioned research (Button et al., 2012), involving a literature search from the UK and USA, 44 interviews in both public and private sectors and a questionnaire survey of around 400 members of the counter fraud community.

Section snippets

Fraud, sanctions and punishment

Fraud is an extremely diverse problem encompassing a very wide range of acts (Doig, 2006). What unites them all is that they involve crimes that ‘… use deception as a principal modus operandi’ (Wells, 1997.) Fraud is a major problem to society (Levi et al., 2007), which the National Fraud Authority suggests cost the UK £73 billion during 2011 (National Fraud Authority, 2011). This has doubled from 2010 although this will not represent the totality of losses to fraud. The KPMG fraud barometer

Fraud investigation

Fraud Investigations are carried out by a number of organisations/staff with varying skills and aims (Brooks et al., 2008). Since the 1980s the number of specialist fraud police officers has declined substantially (Doig et al., 2001, Doig, 2006, Button et al., 2007). The police are not the largest investigative body, but they are the most important. This is because of their gatekeeper role into the criminal justice system and powers of arrest, search and access to information. There are many

Advantages and disadvantages of private prosecutions

One of the principal reasons individuals or organisations pursue private prosecutions is to trigger police interest with the hope they will take that particular or type of cases more seriously. At one level the prosecution is launched in a campaigning way to secure media interest and expose the lack of interest in the police and/or other bodies. This was the approach of cases brought by the League Against Cruel Sports. One consultant described a case:

‘I tried to, and in the end it was taken

Assessment of private prosecution

Private prosecution provides a means to rebalance the opportunities for prosecution between the public and private sectors. The state has many more options if it wants to pursue a criminal prosecution, but for the private sector they are stuck – in most cases – with the CPS. Private prosecution has the potential to be abused, but with appropriate safeguards enabling the private sector to pursue private prosecution more easily to close the gap and relieve the state of some pressures and enhances

A federation against fraud

This could be funded by members and charging for services (possibly on an insurance model). It could be linked to fraud forums and other relevant bodies: publicise the fight against fraud: offer triage and investigative services: offer legal sanctions services including prosecution: offer training services: and accreditation services for counter fraud services providers in: consultancy, investigation, accountancy, legal etc. Our research has highlighted that what many organisations would like

Conclusion

The system of justice that existed before 1829 was described as (Johnston, 1992):

‘…having little or no attempt at criminal detection. Crime was brought to the courts when victims prosecuted offenders. Officials did not go out to find it. Justices dealt with the evidence, but detection and apprehension was left to the victims, who often went to great lengths to regain stolen property…’

We feel that there are parallels in the above statement to the treatment of fraud at the start of the 21st

Acknowledgement

This paper is based on work carried out by the Centre for Counter Fraud Studies at the University of Portsmouth for the Midlands Fraud Forum, Eversheds and PKF: Button et al. (2012)

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