White collar crime in the UK is rising. According to research by Citizens Advice, 36 million adults in the UK were targeted by a scammer between January and June 2021, and UK Finance research reported in the Evening Standard found fraud losses increased by 71% in H1 2021, to £355.3 million.
Understanding this crime is crucial to tackling it, and as a member of the public, avoiding becoming a victim. In this guide we look at what white-collar crime is, and how and why it’s increased during the pandemic.
What is white collar crime? What’s the legal punishment in the UK?
White collar crime is crime undertaken by, or in the realm of, white-collar professionals like lawyers, bankers, brokers, or traders. It can take different forms, including financial fraud, furlough fraud, pyramid schemes, stock market manipulation, unauthorised trading.
In the UK, this sort of activity is covered by a few different pieces of legislation:
- The Fraud Act 2006 prescribes up to ten years in prison for criminals who engage in general fraud offences – either through abuse of position, false representation, or failure to disclose information.
- Fraudulent trading is covered for businesses under the Companies Act 2006, with up to ten years in prison. For partnerships and sole traders, fraud is covered by the Finance Act 2006.
- Money laundering (changing the ownership of crime proceeds to make them appear legitimate) is covered by the Proceeds of Crime Act 2002.
- Conspiracy to commit fraud is a common law offence with up to 10 years in prison.
- False accounting is punishable under the Theft Act 1968.
- Cartel activity (anti-competitive activity by two or more businesses) is covered by the Enterprise Act 2002.
- Market manipulation is currently punishable under the European Union’s Market Abuse Regulation of 2016.
Due to the sheer number of laws spanning white-collar crime, it’s crucial that businesses hit by fraud or wishing to protect themselves from it hire white collar crime legal experts in the field of fraud law.
How and why has white collar crime increased during the pandemic?
White collar crime has increased across a wide range of areas. UK Finance’s research found a 131% increase in criminals impersonating bank staff and police, 110% in fraud related to advance paying of fees, 95% from investment scams, and a 62% increase in romance scams.
The increase in these scams is primarily due to the pandemic. People who have saved money but looking to maximise returns are being taken in by fraudulent investments. Everyday people are being tricked by fake communications regarding vaccines and COVID treatments, that ask them to send money. And companies are committing furlough fraud as governments try and protect livelihoods.
And importantly, white collar crimes have been increasing over the past few years anyway as police cuts and increasingly sophisticated criminals mean fraud cases are tougher to track and solve.
Have you been affected by white collar crime? Let us know your experiences in the comments seciotn.