City fraud: Cuts blamed for drop in police investigations

Budget for specialist white-collar officers has fallen by 15% over past five years

The UBS trader Tom Hayes jailed for fixing Libor rates (Getty Images )

Funding cuts have seen the number of economic crime cases investigated by the City of London Police drop by more than a quarter in the last four years.

The specialist white-collar police force investigated 777 economic crimes in the year to March 2012, but that fell to just 563 this year, according to a study by the law firm Pinsent Mason. The force’s budget has been cut by 15 per cent over the last five years to stand at £121.6m in 2014/15.

Barry Vitou, the firm’s head of global corporate crime, said: “The fact that there are fewer investigations does not, unfortunately, mean that white-collar crime rates are down. It is simply another indication that the bodies tasked with tackling the issue are ill-equipped to do so.”

The slide in investigations since 2011 – which reached a nadir of 520 in 2013/14 – comes despite Action Fraud, the central body for reporting suspected fraud, receiving more than 200,000 calls and emails last year. It also follows high-profile cases such as the conviction of UBS trader Tom Hayes, who was jailed for 14 years for Libor-fixing in August.

Mr Vitou added: “The sharp decline in investigatory work seems at odds with a backdrop of high-value fraud and major corporate scandals across the City and global financial services industry – including convictions for Libor-rigging and international probes into precious metals price fixing.”

He said: “The Government needs to be sure that the force is well-resourced enough to deal with the task in hand. The police cannot effectively crack down on the most serious and damaging fraud without increased funding and stronger support from politicians.”

A spokesman for the City force said the number of investigations alone did not reflect overall performance. “Comparing the number of investigations year-on-year does not reflect the changing nature, complexity and scale of the investigations taken on by the City of London Police’s economic crime directorate. In particular there has been an increasing focus placed on the identification and disruption of organised crime gangs.”

He added: “It also does not reflect the emphasis now being placed on victim care and the resources being directed towards preventing and disrupting fraud – last year [2014/15] the National Fraud Intelligence Bureau requested the suspension of websites, phone numbers and bank accounts that had the potential to cause £476m-worth of crime. This compares with the previous year when the figure was £305m.”