Counter Fraud 2025 Speech

(QEII Centre, London)

Good afternoon. Thank you GovNet for inviting me.

I have been asked to deliver a speech to you today on the following subject:

As some of you already know, I am a Solicitor. I specialise in helping people who have been debanked when fraud markers have been unfairly or incorrectly loaded against them by banks and other financial organisations.

During lockdown, I witnessed hundreds of young people being debanked after they had unwittingly become money mules. Most had no idea what money laundering was, nor that it is a criminal offence, and they had no idea of how to spot the signs in order to help themselves to avoid being drawn into it.

To this day I can count just a handful of young people who have told me they have actually read their bank’s terms and conditions – even those that had read them have struggled to understand them. This applies to adults too. The level of naivety and ignorance shocked me; it continues to.

I started to write about the devastating impact and cost that fraud markers can have on individuals and businesses when they are applied – such markers can ruin career opportunities and aspirations, lead to debanking, unemployment, loss of businesses and homes, and cause difficulty in obtaining most lines of credit.

I developed a presentation that I delivered to the upper sixth of my daughter’s old school, and I posted my experience on LinkedIn. That post was picked up by Robert Brooker, who was Chair of the National Fraud Forum. It was soon clear that not enough was being done to educate children about the risks of money laundering, and that the counter fraud community had grave concerns about this issue.

"such markers can ruin career opportunities and aspirations"

The “Schools Project” was born, and a group of like-minded individuals was formed out of connections from the counter fraud, academic and finance communities. Those discussions led to us petitioning Government to make fraud awareness education compulsory on the national curriculum.

The Schools Project was formalised into FFAC C.I.C. in May 2024 to manage the Financial Fraud Awareness Campaign.

MY BOOK

Today I am proud to announce the publication of my book:

It has been published by Routledge as part of Professor Nic Ryder’s academic series, The Law of Economic Crime.

In it I have explained why fraud awareness education and training should be promoted and considered a key component in the fight against fraud and money laundering.

Why? Because I have lost count of the hundreds of times I have been told:

"If only I had known this stuff"

"I had no idea"

"I didn’t think I was doing anything wrong"

I have never understood why the organisations that load fraud markers have not explained in clearer terms to their customers about the fraud marker systems they use.

Most of the people I have spoken to who have been affected by fraud markers have complained that they had no idea what Cifas is, and that includes many people working in banking and finance.

“Surely if people are forewarned of the risks, they can make better informed decisions? And by being explicit about the consequences would it not potentially save the banks vast sums of money on fraud prevention?” (1)

How many people do we know who refuse to listen when you tell them not to do something? People question you. Therefore, we need to explain that “the reason is this…”; and that is what my book does.

The scale of the problem is huge. The 2023 joint study by Crowe, the University of Portsmouth, and Peters & Peters, found that fraud costs the UK economy up to £219 billion annually. (2)

"discussions led to us petitioning Government to make fraud awareness education compulsory on the national curriculum"

The Office of National Statistics recently reported that for the year ending September 2024 there was a 19% rise in fraud incidents in England & Wales (3.9 million of them) (3). It also found that consumer and retail fraud rose by 26%; bank account credit fraud rose by 15%; and the police recorded that fraud rose by 9.2% to 1.2 million incidents.

It is clear that the current counter fraud measures and fraud awareness education on offer aren’t making much of a breakthrough. The vast scale of fraud and money laundering has created a national emergency which should be considered a shame on our nation.

"by being explicit about the consequences would it not potentially save the banks vast sums of money on fraud prevention?"

Without access to mule accounts, criminals cannot cash out their ill-gotten gains. Discourage the money mules and you leave the Organised Crime Networks (“OCN’s”) with limited ability to launder their funds, therefore, making it easier for law enforcement to detect, disrupt, arrest and confiscate.

The previous Government recognised the Money Mule problem and in March 2024 launched its action plan (4). FFAC however proposes targeted education and training on a greater and more comprehensive scale than imagined by politicians.

Whilst the previous Government’s National Fraud Strategy focused attention on school-aged children, it failed to address much of the wider problem. FFAC’s work fits neatly into this strategy because according to Cifas whilst 19% of money mules are under the age of 21, 62% are below the age of 30 meaning that 38% are even older than 30 (5). According to the police officers I have spoken to about this issue, the 35-to-44-year age group is the fastest growing target of OCN’s.

The FCA published a report on 23rd January which demonstrated a wide variance in the use of the National Fraud Database in relation to the reporting of money mule activity. Twenty-five firms were monitored who reported anywhere between 6% and 66% of cases to the NFD between January 2022 and September 2023. Of 194,084 accounts that were offboarded, only 37% were reported to the NFD. Part of the reason for that must be that the banks have recognised that most money mules are non-complicit or unwitting. Doesn’t unwitting mean ignorant?

As Terry Pratchett wrote:

“They say a little knowledge is a dangerous thing, but it’s not one-half so bad as a lot of ignorance." (6)

IDENTIFY THE TARGETS FOR EDUCATION

We know that fraud and money laundering adversely affects all communities, all ages, all areas of society, and all ethnic backgrounds.

Aside from schools and universities, some significant areas of concern that I see on a weekly basis in my practice are from the following groups:

• Young adults who have left education and who are entrusted with bank accounts for the first time are prey to OCNs who target their naivety and willingness to earn money through “side hustles”

• Economic migrants are prone to assisting each other, commonly falling into the trap of acting as money mules, where language barriers and ignorance is preyed upon

• Businesses are targeted to move money for fraudsters through active participation or by covert means

• Start-up enterprises with little understanding of account security and good practices are targeted

• People selling products online, using forums such as Facebook Market Place, where charge backs are commonly used by fraudsters not just to obtain goods illegally, but to launder the proceeds of crime

• The victims of domestic abuse and those facing coercion within their relationships

• Crypto currency users are commonly targeted and used to launder the proceeds of crime, and charge backs are frequently used by fraudsters against innocent people trying to cash out their legitimately purchased and invested crypto assets

• Older people are targets of Approved Push Payment frauds and theft of account details

• People looking for work are targeted by bogus job adverts which are fronts used by OCNs to develop mule accounts

• Those poorer members of society are often offered money in return for their account details

• Cultures where there are laudable traditions of money lending and assisting families are vulnerable to OCNs

• Diaspora and cultures where unregulated money transfers (i.e. Huwala) are commonly used, for example in Nigeria and Pakistan

It is clear that a “one size fits all” approach to fraud awareness is not applicable, and tailored approaches are required to each group I have described. Some will be more difficult to penetrate than others, but each is important.

Virtually no training is available for, or targeted to, many of these groups.

Targeted training as opposed to generic mass messaging is important. In a recent report, "Disseminating fraud awareness and prevention advice to older adults' perspectives on the most effective means of delivery" (7), Professor Mark Button and others found that “a significant number of older adults are not receiving any fraud prevention advice or awareness.”

That report referenced another study by Jensen et al. (2024) which conducted an evaluation of a bank’s campaign targeted at customers over 40. The study created two groups: one receiving a fraud warning message through the online banking portal, the other not. Extensive data analysis was undertaken using different characteristics; the researchers came to the conclusion, “Our results show that the considered campaign, relying on mass messaging, had little effect in terms of reducing financial fraud”. (8)

The Delivery Problem

Nationally the Police have insufficient resources to deliver the training required. Within the eight Regional Organised Crime Units, there is a difference of approach to fraud education – some have dedicated teams, but others do not and instead rely on trainee police officers to deliver it.

The banks are under a duty to provide training, awareness and support to new customers but sustained high levels of reported fraud indicates that this is not sufficiently effective.

There is increasing awareness on television and in the media, but it tends to be generic, can sensationalise, and misses key target audiences.

Schools rely on on-line tools that themselves are inconsistent and many do not engage the older children – and, where it is delivered, it is limited in scope. Notably, the last Government funded one role within the Childrens’ Society to co-ordinate a national approach from a standing start.

Whilst some training is now being offered to young adults (year 11 onwards at schools, academies, colleges and universities), and according to Cifas’ statistics there has been a slight reduction in mule activity in the under 21’s in the past 18 months, this prevention awareness still presents a very significant national opportunity to make a real difference and rapidly reverse the incidence of fraud.

FFAC can help to arm, compliment, reinforce and support the police, local authorities and other agencies to identify areas of need, tailoring training accordingly, and to deliver it for FREE in a consistent manner to the community groups that are most at risk of being targeted as money mules.

FFAC is linked to the regional Fraud Forums which have more than 2,000 members from the counter fraud, banking, finance, legal and law enforcement communities which will form the base of the volunteers who will deliver this training nationally to their communities.

You can find out more about FFAC from our website www.ffac.co.uk. Commercial sponsorship to assist with funding this vital work would be very welcome.

In conclusion, politicians, regardless of political persuasion, need to realise that this is an area that requires strong leadership and regulation. KYC and AML procedures are essential, but politicians see regulation as an inhibitor to growth.

Fraud is regarded as the elephant in the room. It has been seen as too big and unsolvable, and why draw attention to the fact that Great Britain really is the fraud capital of the world? But this head-in-the-sand approach does not provide leadership and does the population of this country great disservice.

We cannot afford for politicians to be asleep at the wheel.

As explained, my proposed strategies to deliver effective counter fraud education are these:

1. increasing awareness of the fraud database systems;

2. targeting consistent training delivered face-to-face by counter fraud professionals;

3. government and the police need to work together with counter fraud professionals in the private sector to deliver that training;

4. the police must ensure that consistent messaging, capabilities, and procedures are replicated across all police forces and areas.

The problem is solvable, and fraud awareness education can be done at no cost to the exchequer. All it requires is political willingness to open doors for counter fraud professionals to be able to deliver their knowledge to those who need it most.

To understand further about the issues touched upon in this speech, please read my book. Thank you.

_______________

1. Fraud Markers, De-banking, and Financial Crime: A Legal Analysis of Counter-fraud Practices in the UK and Beyond, by Jeremy Asher. Published by Routledge. ISBN 9781032962054

2. Peters & Peters and Crowe report shows fraud is costing UK £219 billion a year

3. Crime in England and Wales - Office for National Statistics

4. https://www.gov.uk/government/publications/money-mule-action-plan

5. Cifas Fraudscape Report 2024

6. "Equal Rights", by Terry Pratchett. Published by Harper Perennial. ISBN 9780060855901

7. "Disseminating fraud awareness and prevention advice to older adults: perspectives on the most effective means of delivery"

8. Jensen, R.I.T., J. Gerlings, and J. Ferwerda. 2024. Do awareness campaigns reduce financial fraud? European Journal on Criminal Policy and Research. https://doi.org/10.1007/s10610-024-0957