Treasury Committee calls for urgent economic crime measures

The Treasury Committee has published its long awaited report on Economic Crime. It is concerned that the Economic Crime Plan has not been as effective as hoped, and says the need for additional funding can’t just be met by the economic crime levy. It notes that conclusions of the Joint Committee on the draft Online Safety Bill that self-regulation of online platforms has failed and is pleased that the Online Fraud Steering Group has now been set up.  Key conclusions and recommendations include:

  • that the Government should legislate against online fraudulent adverts – and that FCA should both have power to enforce regulations in relation to online companies advertising and that these companies should not profit from paid-for advertising by FCA of warnings
  • that serious consideration should be given to whether online “giants” should reimburse those who are victims of scams on their platforms
  • the need for urgent legislation to make APP fraud reimbursement mandatory with the PSR given powers to enforce it
  • properly resourcing law enforcement and considering whether a single agency with a clear responsibility to fight economic crime would be more effective – welcoming the improvement of the AML supervisors but suggesting more is still needed
  • the need to push forward the SARs reform programme, and a suggestion that the effectiveness of SARs might be increased if banks are allowed to share information with the NCA before the suspicion threshold is reached
  • requiring FCA to report annually on derisking by banks to ensure banks are not acting unfairly
  • the need for proper regulation to protect consumers from fraud and money laundering in the cryptoasset industry alongside current ASA initiatives. It particularly says that FCA should not extend the deadline for relevant crypto firms to register beyond March 2022;
  • expressing, again, its disappointment that no real progress has been made on the reform of corporate criminal liability; and
  • higher company formation fees alongside Companies House reform to act as a greater deterrent to fraudsters.

It also calls for the Government to disclose what legislation it is working on that could be included in an Economic Crime Bill.

Emma Radmore