Financial Fraud and Economic Crime

Chris Coghlan Excerpts

Wednesday 11th September 2024 Westminster Hall

[Chris Coghlan (Dorking and Horley) (LD)]

It is a pleasure to serve under your chairmanship, Ms Vaz, in this brilliant and necessary debate. I commend the hon. Member for York Outer (Mr Charters) for securing this debate on financial fraud and economic crime and for his professional expertise in this area. I should declare an interest: I spent 11 years working in financial services and also worked in the Foreign Office on counter-terrorism, so I know how vital this debate is.

The hon. Member for York Outer made really interesting points in his seven proposals, particularly on the link between tackling fraud and economic growth and his call for a national anti-fraud centre based on the Australian model. The Liberal Democrats called for an online crime agency in our manifesto, so it is something we would be interested in supporting.

We need a dedicated body to tackle online crimes such as personal fraud; our police forces are overwhelmed. Local forces lack the specialist skills required to combat the complexity of modern online crime. Although the National Crime Agency focuses on the most serious offences, we need an agency specifically equipped to deal with online fraud.

[Jim Shannon]

I commend the hon. Gentleman for making that reference to the NCA. I understand that just last week the NCA issued its first unexplained wealth order in Northern Ireland against a man suspected of involvement in serious organised crime. If anyone is living above their means, there should be questions about where the money is coming from. Does the hon. Gentleman feel that there perhaps needs to be more emphasis on that as well?

[Chris Coghlan]

I thank the hon. Gentleman for his intervention and I agree that there should be more emphasis on that area. I also thought that the hon. Member for York Outer made a really interesting point about the lack of FCA regulation of the Post Office, and I agree that that appears to be a gap in our existing regulatory framework.

We heard some really moving personal accounts about the cost of these online scams in the speech made by the hon. Member for Southend West and Leigh (David Burton-Sampson). We are also calling for the naming and shaming of the banks that have the worst records on preventing fraud and reimbursing victims. They should be held accountable. Financial institutions have a duty to protect their customers and we need to call them out when they do not.

The hon. Member for Strangford (Jim Shannon) talked about the power of social media scams, and we are also calling for a public awareness campaign. We need to empower everyone to spot, avoid and report fraud and scams. But let me be clear: the onus should not be on individuals to prevent fraud. Victims should never be blamed for falling prey to sophisticated scams. This issue is about building a society that protects citizens and not one that burdens them with responsibilities that should lie with institutions.

As we have heard, the numbers involved are staggering, both in terms of the billions of pounds that have been lost to fraud and the sheer volume of crime that is now online. Despite those facts, however, the previous Government’s response was lacklustre. I was moved by the hon. Member for York Outer’s point that 40% of crime is fraud, including online fraud, yet only 1% of police resources is dedicated to tackling fraud. The previous Government treated fraud with such little seriousness that they did not include it in crime statistics. Will the Minister commit to including fraud in crime statistics to demonstrate the new Government’s seriousness about this issue?

The Government must also recognise that economic crime poses a significant threat to our democracy. For too long, the previous Government allowed oligarchs to treat the UK as their personal playground, so that they could funnel dirty money into our economy and undermine our values. The Liberal Democrats are calling on the Government to begin seizing frozen Russian assets and to use the proceeds to support Ukraine; to close loopholes in economic crime legislation, which allow associates of authoritarian regimes, such as Putin’s cronies, to funnel corrupt funds into our country; and to properly resource the NCA to ensure that it has the tools to tackle complex financial crimes. We are also calling for an audit of UK-based assets owned by officials from countries with troubling human rights records, such as China and Iran, to ensure that we are not enabling regimes that abuse their own citizens.

As a former counter-terrorism officer, I know how important cross-border co-operation is. The hon. Member for Wolverhampton North East (Mrs Brackenridge) really brought out the importance of such co-operation when she made the point that the people conducting these scams are not necessarily all in the same geographical location.

I also know the damage that Brexit caused to our cross-border co-operation on serious and online crime. Will the Minister commit to improving co-operation with our European allies and with other countries more widely on financial fraud and economic crime?

I look forward to hearing the Minister’s response to the debate. It was a pleasure to serve with you in the Chair for this debate, Ms Vaz, and I again thank the hon. Member for York Outer for securing it.

[Valerie Vaz (in the Chair)]

I call the shadow Minister, who was appointed this morning, to speak.