UK fails to get to grips with internet fraud

Internet fraud - which accounts for 8% of all fraud in the UK - is growing unchecked, says report

The UK is trailing behind other countries in its efforts to track and investigate internet fraud, according to a new report from the Attorney General’s office.

The Attorney General, Lord Goldsmith, criticised UK authorities for failing to come up with a centralised way for consumers to report internet fraud, as has been done in countries such as the US and Canada. The result is that internet fraud — which accounts for 8% of all fraud in the UK — is growing unchecked, the report says.

“It is often confusing for victims to know who to report the fraud to, particularly if it crosses geographical or sectoral boundaries,” Goldsmith says in the report. “Fraudsters benefit from this lack of continuity of response. Internet fraud is a particularly good example of how a fraud can become difficult to report.”

He used the example of a fraudster, Mr Bogus, who defrauds a user by advertising products on an internet auction site, to illustrate how such crimes are often not taken seriously.

“Mr Bogus remains free to re-advertise the computer and performs the same fraud on an increasing number of victims. The police and trading standards do not identify Mr Bogus as a repeat offender because the reports of fraud are either not accepted or appear in different force areas,” Goldsmith says.

He says such crimes have a far larger effect than they appear to because of “externalities”, such as the chilling effect on e-commerce in general. As an example, the 2002/03 British Crime Survey found that 75% of respondents were worried about the security of using a credit card online, Goldsmith says.

He urged the creation of an internet fraud reporting scheme on a national or EU level, along the lines of the US’s Internet Crime Complaints Centre (IC3) or Canada’s Reporting Economic Crime Online (RECOL) centre.

“While no such centre exists in the UK to tackle fraud, a national reporting centre has recently been launched to tackle pedophilia and protect children,” Goldsmith writes.

“This model shows that it is possible to establish such operations in the UK and it is feasible to do so.”

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