The Serious Fraud Office (SFO) has called for bankers and other potential whistleblowers in the City to come forward with evidence as the credit crisis uncovers financial crime and creates opportunities for an increase in scams.
The SFO said it was making the move because past experience showed that financial market turmoil had uncovered fraud as companies got into difficulty and that financial crises also encourage more dishonest activity. "We've found in the past that at times of market turbulence fraud is discovered," said Richard Alderman, the director of the SFO. "We find out what's been happening as a result of turbulence in the markets and we also find there's opportunity in those markets for more fraud."
The SFO, which deals with complex and serious fraud typically involving cases of at least £1m, is asking financial industry workers to blow the whistle on bad practices. It is targeting staff, ex-employees, shareholders and others. The SFO is posting a special form on its website so that those employed in the City's financial services industry can report financial crimes. The SFO has written to the senior and managing partners of the leading accountancy and legal firms in London asking them to help it identify fraud and is working with its international counterparts, including the FBI. Mr Alderman, who took over as head of the SFO in April, has pledged to prosecute cases more quickly and confiscate more of fraudsters' assets to help restore public confidence in his agency.
Business fraud in Britain has increased rapidly since the economy worsened. Reported fraud in the finance and insurance sectors in the first half of this year was £636m, 15 times the level a year earlier, and was typically from internal management and suppliers rather than organised crime, a report by BDO Stoy Hayward found earlier this year.
David Cameron, the Leader of the Opposition, said the authorities needed to be more active in punishing financial wrongdoing. The Tories' leader said in a speech yesterday that UK regulators and authorities should pursue financial crime as rigorously as those in the US. "The FSA and the SFO should be following up every lead, investigating every suspect transaction. And the Government should be urging them on," he said.Reuse content