Action Fraud 'turmoil' leaves litigation the only option for fraud victims, says expert

Broadcasting Support Services (BSS) ran Action Fraud when it was first established in 2013, and continued to operate its call centres after the service was handed over to City of London Police last year. The company went into administration in July and is now operating with a skeleton staff, and some calls are going unanswered, according to the Daily Mail.

The Daily Mail reported that the Home Office had been conducting "crisis meetings" to ensure that the service would continue to run until a new call centre operator could be found. However, civil fraud and asset recovery expert Alan Sheeley of Pinsent Masons, the law firm behind Out-Law.com, said that in many cases, civil litigation was the most effective way to pursue fraudsters.

"With Action Fraud in turmoil and recovery rates not improving significantly, the only real way victims can fully recover their monies that have been stolen is by way of civil fraud proceedings," he said.

"Civil fraud solicitors can react immediately on the discovery of a fraud. They have a whole arsenal of weapons at their disposal to launch against the fraudster such as search and seize orders, which enable the victim's solicitor to enter the fraudster's properties to preserve evidence; and freezing orders, to enable the victim's solicitor to freeze the fraudster's bank accounts to avoid dissipation of the stolen monies by the fraudster. This instant reaction ultimately leads to the recovery of stolen monies, which is the number one priority for victims," he said.

Action Fraud was first established two years ago as a nationwide, centralised means in which members of the public and businesses could report financial crime. It was set up after the National Audit Office found that only 26p in every £100 stolen was recovered by law enforcement authorities in 2012/13 (52-page / 772KB PDF), and to address public confusion over who best to report incidents of fraud to out of the many agencies working in this area, including the Serious Fraud Office (SFO), Financial Conduct Authority (FCA) and local police.

The number of people prosecuted for fraud and corruption offences fell by almost one fifth between 2011 and 2014, despite an increase in the number of tip-offs to Action Fraud and the SFO's 'SFO Confidential' tip-off line, according to figures obtained by Pinsent Masons earlier this year. At the time, corporate crime expert Barry Vitou raised concerns that cuts to the funding of the SFO and City of London Police were affecting their ability to pursue and investigate leads.

A spokesman for City of London Police told the Daily Mail that the force had been "working closely" with the Home Office and administrators for BSS to maintain the service. The contract with BSS was due to expire in December 2015, he said.

"We are closely monitoring call volumes and will ensure an adequate service is maintained," he said.

"There are alternatives to using the phone service to report fraud, including the online reporting tool available via the Action Fraud website, calling the non-emergency 101 service and also reporting in person at a police station. We will not be disclosing details of financial arrangements between ourselves and BSS as this would contravene the rules around the administration process," he said.