Fraud Pays. Victims Pay More.
Safoah Ntiamoah • 11 February 2026

By Carly Barnes-Short and Safoah Ntiamoah


When Britain’s national fraud police publicly concede that it is “not always efficient to take fraudsters to court”, something has gone profoundly wrong. The remark appeared in the launch materials for Report Fraud, a £175 million overhaul of the UK’s fraud reporting system, presented as a long-overdue modernisation of data sharing, prevention, and victim engagement.


On paper, the reforms promise progress. In practice, they expose a more troubling reality. A system in which operational efficiency is increasingly prioritised over criminal accountability, and in which the costs of fraud are quietly transferred away from perpetrators and onto their victims.





Policy Rationale


For years, Action Fraud, derided by critics as “Inaction Fraud”, has failed victims, campaigners, and parliamentarians alike. It became synonymous with poor victim support, negligible follow-up, and vanishingly rare outcomes. Reform was not only inevitable but necessary.


Yet improving the mechanics of fraud reporting is not the same as improving how fraud is investigated or prosecuted. This distinction matters. Modernisation on paper cannot substitute for justice in practice, particularly when senior officials suggest that “alternative outcomes” short of prosecution are preferable, or worse, more convenient than holding fraudsters to account.


For victims, the question is unavoidable. If criminal justice is no longer the objective, what, exactly, is being offered in its place?




The Consequence


Working closely with the V11 has revealed the true human cost of fraud in a way no policy paper ever could. The cases of these former Premier League footballers are often regarded as the exception because of their public profile, yet their significance lies not in rarity, but in their visibility. Their experiences bring into sharp focus a far broader and largely unseen population of fraud victims whose lives have been similarly disrupted, but whose suffering rarely commands attention, advocacy, or redress.


The harm extends far beyond financial loss. Fraud fractures lives. It undermines physical health, strains family relationships, and corrodes mental wellbeing. For some, it has meant the loss of their homes. For others, the looming threat of insolvency. For many, it has extinguished any realistic prospect of a secure retirement.


These are not abstract harms, and this is not a victimless crime. These are lifelong consequences imposed not by recklessness, but by criminal deception followed by institutional abandonment.




The Accountability Gap


There is a bitter irony at the heart of the current system. While justice is denied in the name of efficiency, victimhood is simultaneously acknowledged. Pete O'Doherty, the UK's National Fraud Police Commissioner, has himself recognised that it causes “more than financial loss and often has devastating impacts on those targeted”.


The harm is accepted. The trauma is recognised. Yet meaningful action rarely follows.


This is the quiet cruelty of the prevailing approach. Victims are validated in theory but deserted in practice. Their suffering is recorded, logged, and analysed, yet seldom addressed. Efficiency becomes the justification for inaction, even as other arms of the state continue to pursue those same victims for tax, penalties, and interest arising from the very schemes the police have chosen not to prosecute.


What emerges is not an accidental gap in enforcement, but a deliberate reallocation of responsibility. Fraud is acknowledged. Victims are recognised. Accountability is quietly displaced. Investigations are deemed too costly. Prosecutions too inefficient. The burden is shifted downstream, away from perpetrators and onto those already harmed.


This is not justice delayed. It is justice deprioritised by design.




No Justice, But the Taxman Still Collects


Despite the absence of criminal accountability, the tax system continues to operate with relentless precision.HMRC’s enforcement approach does not meaningfully account for recognised victimhood, resulting in victims being pursued as though they themselves were responsible for the fraud. Losses are not absorbed by the state, nor redirected toward perpetrators. They are monetised.


Some individuals have been pushed into insolvency. Others remain trapped in disputes that have dominated decades of their adult lives. Many have been publicly labelled “tax avoiders”, despite being formally recognised as fraud victims by the police and having paid tax in good faith for years.

Victimhood rarely carries weight in tax outcomes. This is the point at which the system crosses from ineffective to fundamentally unjust.




Call to Action


How can a system that perpetuates harm credibly claim to prevent it?


Fraud has been the most common crime in England and Wales since 2016, affecting everyone from key workers to high-profile professionals. Yet without a meaningful shift in enforcement priorities, victims will continue to shoulder the costs of a framework optimised for administrative efficiency rather than accountability.


The result is not deterrence, but repetition. Recidivism remains high, reflecting a simple truth: penalties without prosecution, and enforcement without justice, do little to curb criminal behaviour.


What signal does this send? That fraud is acknowledged as harmful but deemed too inconvenient to pursue. That criminal accountability is treated as optional, while financial recovery from victims is not. In such a system, risk is systematically transferred away from perpetrators and onto those already harmed.


This is not merely a policy failure. It is an incentive structure. One that rewards fraudsters with impunity and leaves victims to settle the bill.




The Role of the Investment Fraud Committee


This is where the Investment Fraud Committee plays a critical role in establishing accountability and justice. 


The IFC supports reform of fraud reporting, but victims need more than refurbished systems. They need accountability, credible deterrence, and a tax response that reflects the lived reality of fraud. Reform that improves reporting while abandoning victims at the point of justice is not reform at all.


The IFC will work with MPs across Parliament to challenge the current approach and to press for sustained scrutiny of how fraud is policed, prosecuted, and addressed within the tax system once victims come forward. Parliament must ask whether a system that prioritises efficiency over accountability, and disregards recognised victimhood in tax outcomes, is truly protecting the public, or merely redistributing costs onto those already harmed.


Alongside this, the IFC is working with leading lawyers at Mishcon de Reya and the Social Market Foundation to examine how other jurisdictions approach fraud from both a law enforcement and tax perspective, and what reforms the UK urgently needs to adopt.




Policy Box: What Reform Must Look Like for Fraud Victims


If the UK is serious about tackling fraud, reform must be systemic. Policing, prosecution, and tax policy must be aligned. Improving reporting alone is insufficient.


1. Prosecution must remain a core objective
Fraud is the most prevalent crime in the UK. While prevention and disruption matter, criminal prosecution must remain central for serious and harmful fraud. Without visible accountability, deterrence collapses and repeat offending flourishes.



2. Victim classification must carry legal weight
Formal recognition as a fraud victim must have consequences across the system. Victimhood cannot exist solely for reporting purposes while being ignored in subsequent state decision-making.



3. A fair tax response for recognised victims
HMRC policy must explicitly account for fraud victimhood. Where losses arise from fraud, tax enforcement should be paused during criminal investigations, interest and penalties should not accrue automatically, and outcomes must reflect harm suffered rather than presumed misconduct. A system that withdraws criminal justice while pursuing victims through tax enforcement is incoherent and unjust.



4. Alignment between policing and tax authorities
There must be structured coordination between fraud policing and HMRC so that the absence of prosecution does not default to assumptions of taxpayer wrongdoing, and policing decisions taken on efficiency grounds do not result in lifelong financial punishment for victims.



5. Learning from international best practice
Other jurisdictions, notably the United States, treat financial fraud as a serious crime, with properly resourced investigations, prosecutions, and sentencing that deter repeat offending. The UK should benchmark against these models, including how victim losses and tax consequences are handled.



6. Parliamentary oversight and transparency
Given the scale of fraud and the public money involved, Parliament should scrutinise whether deprioritising prosecutions represents sound use of public resources, the impact on recognised victims, and whether the current framework protects the public or merely shifts costs onto those harmed.

Fraud is now Britain’s most common crime, yet its victims are treated as collateral damage. Reform is not optional. It is the minimum a just state owes those it has failed to protect.




Bibliography 

(Harvard)


Broadcast Media



Government Publications



News Articles



Websites

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