Economic Crime Probes by London Police Plunge Amid Budget Cutsby
Number of cases slashed by nearly a third in past four years
Law firm says data a sign of how watchdogs are ill-equipped
The number of economic crime investigations taken on by the City of London Police fell 28 percent over the last four years, as the force has faced government cuts, according to a law firm report.
The force -- responsible for law enforcement in London’s financial business district known as “the Square Mile” -- investigated 563 economic crime cases in 2014-2015 down from 777 in 2011-2012, a report from London-based Pinsent Masons shows. The data was taken from a freedom of information request by the firm based on a March year-end.
The City of London Police are on the front line for economic crime due to its proximity to financial firms and the assistance it gives to agencies such as the U.K. Financial Conduct Authority and Serious Fraud Office. The organization’s been involved in high-profile cases including the 2011 arrest of Kweku Adoboli, the former UBS Group AG employee whose unauthorized trading caused a $2.3 billion loss at the bank.
“The fact that there are fewer investigations does not, unfortunately, mean that white collar crime rates are down," said Barry Vitou, head of global corporate crime at Pinsent Masons. "It is simply another indication that the bodies tasked with tackling the issue are ill-equipped to do so.”
15 Percent Cut
The City of London Police has seen a 15 percent budget cut in the last five years as the U.K. government reduced public spending in the wake of the financial crisis. The force has teamed up with the industry to help develop its economic crime arm. In 2014 it signed a memorandum of understanding with the Royal Bank of Scotland Group Plc to obtain financial assistance in complex fraud and economic crime investigations.
“Comparing the number of investigations year-on-year does not reflect the changing nature, complexity and scale of the investigations taken on by the City of London Police’s Economic Crime Directorate, ” the force said in an e-mailed statement. “In particular there has been an increasing focus placed on the identification and disruption of organized crime gangs both in the U.K. and overseas.”
“It also does not reflect the emphasis now being placed on victim care and the resources being directed toward preventing and disrupting fraud,” the police said.
In the last few months, the U.K. government has expressed a willingness to have less regulation of the industry in an attempt to promote growth. A much campaigned-for change to legislation that would have made it easier to prosecute corrupt companies was abandoned in September. In a speech in June, Chancellor of the Exchequer George Osborne said that the era of "simply ratcheting up ever-larger fines" against banks must end.