NFIB eNewsletter - February 2011

Message from Det Supt Tony Crampton of the City of London Police, Director of the NFIB

I am very pleased to be able to say the Home Office has confirmed funding for the NFIB will continue for at least the next two years. To have achieved this in the current economic climate is evidence of how quickly the Bureau has established itself as a key component in the fight against fraud. This is thanks to the hard work and expertise of all those working in the NFIB, and the ongoing support of our stakeholders who have contributed so much towards its development. The challenge now is to maximise the full capabilities of the NFIB and show it represents money well spent by the Government.

Guiding us towards meeting these objectives will be the recently published NFIB Strategic Assessment. Through our analysis, and in consultation with counter fraud partners, we have identified technology, professional and financial enablers to be the critical fraud threats we now face and the key focus areas for the Bureau. These conclusions proved to be especially prescient after a Government-supported study estimated cyber crime alone to be costing the UK economy £27 billion a year.  Our priorities for 2011 are to improve and enhance our knowledge in these three areas and help formulate national strategies to combat the criminal elements behind them. This work will feed back into our key activities that will see better fraud prevention measures in place and more effective fraud investigations taking place. With fraud in the UK now valued at £38 billion a year we do not have a moment to lose.

Know Fraud update

A total of 2.25 million crime-related records have now been ingested (confirmed reports of fraud) and are being analysed against a fast growing source of reference data. From this information the Know Fraud system has, to date, identified around 100,000 criminal networks and pinpointed 858 groups of interest. These groups link to around 23,000 persons of interest and almost 31,000 victims.

System testing of new reference data is in progress that will soon result in the NFIB being able to search against a resource of information that is in the region of 1.5 billion records. New data sets ingested since Christmas include Wanted Persons, Vodafone Hotlist/confirmed fraud and VeSTAG (Autotrader, Motors UK, Petrol Heads etc). This month will also see the Insurance Fraud Bureau and WorldCheck data ingested. Other information currently under evaluation includes data from the UK Borders Agency, DWP, Intellectual Property Office and IATA. The NFIB is also awaiting rollout of  the Police National Database (PND).

In December and January the NFIB Analytics Team carried out 84 network assessments relating to crimes that included online shopping and auctions fraud, timeshare and holiday club fraud, lottery fraud and cheque/plastic card fraud. During this period 14 different police forces, the Bank of England, SOCA and the Scottish Crime and Drug Enforcement Agency requested assistance on more than 600 enquiries. One of these checks concerned UK and US authorities identifying a criminal network that led to the City of London Police making an arrest in Manchester in connection with an international email fraud.  

December also saw the Met Police, City of London Police and West Midlands Police ingest their wanted persons information to the Know Fraud system. This resulted in significant linkages leading to the formulation of 983 criminal networks, including 48 from City of London Police data. These have been disseminated to support efforts to trace, arrest and reduce the impact of fraud criminals at large.

NFIB Strategic Assessment

The recently published NFIB Strategic Assessment has identified the current and future threats from fraudulent activity to UK society. The key judgements focus on:

• The development of technology and how offenders seize the opportunity to use new technologies to aid them in compromising personal data and accessing victims.
• The availability of information publicly on websites, which offenders use to their advantage.
• The reliance of UK society on the internet and the continued move to a cashless society.
• The use of forged or counterfeit financial instruments to facilitate fraud offences.
• The role of professionals in enabling the criminality and realising gain from the offences.
• Establishing a common ground with industry partners to introduce new methods of operation or working practices which will prevent future criminality, particularly in the current economic climate.
• Organised criminals identifying and exploiting the national and international jurisdictional silos that divide law enforcement and regulatory response to fraud as particularly evident around cyber crime.

These are now being considered for the NFIB control strategy priorities for 2011, including the objectives and owners for each of the key areas. This document has already been circulated. Counter fraud partners can request a copy of the assessment by e-mailing nfd@cityoflondon.pnn.police.uk or visiting the secure POLKA portal which can be accessed by police forces via the NFIB website: www.nfib.police.uk

NFIB in action

Operation Archway

Operation Archway is the police national Share Purchase Fraud (Boiler Room Fraud) Intelligence unit based in the NFIB. From April to December 2010 it recorded 790 new victims with losses of more than £15 million.

Nationally the team is supporting a number of fraud investigations, including of a suspected £20 million boiler room fraud operating from Spain with links across the UK and Sweden. City of London Police has led the investigation, with assistance from Northumbria Police, Derbyshire Constabulary, Greater Manchester Police and Spanish and Swedish authorities. The Archway team provided identity checks, research and information packs to assist officers during the arrests and interviews of 14 people, and the extradition of the main suspect from Sweden. In excess of 100 victims have been identified and £1.5 million of assets recovered. The case is currently going through the courts and the team is now producing evidential analysis of the data obtained through the investigation for the judicial proceedings.

Archway is also providing intelligence on potential frauds stretching from the US, Hong Kong, Singapore and the Seychelles, where accounts receiving criminally obtained funds are being examined in partnership with local police for laundering offences. This activity is supporting the freezing of assets whilst enquiries continue. Alongside this intelligence gathering the team are actively working on prevention and disruption; working closely with the banks to keep them aware of current trends, liasing with internet and telephone providers to remove fraudulent websites and disconnecting phone numbers linked to boiler room activity.

New trends - land banking fraud

Land banking fraud is when people are conned into buying land thinking it will significantly increase in value. Sometimes the valuation of the land on offer is much lower than the quoted price, and sometimes the land being sold does not even exist.

The NFIB is currently undergoing an assessment of all intelligence held in relation to land banking frauds. Initial research suggests there are a number of commonalities between business representatives, company contact details and modus operandi. Network analysis will be conducted in order to understand the nature and significance of any identified relationships, with a view to assisting current investigations and establishing new lines of enquiry.

The Bureau is also assisting detectives with ongoing land banking fraud investigations. Recent NFIB intelligence led to the arrests of a number of suspects just five days after the City of London Police received the first allegation of fraud.   

Action Fraud update

In January the National Fraud Authority (NFA) published its second Annual Fraud Indicator. The figures collected by Action Fraud helped improve its estimate of the fraud figure against individuals. Action Fraud saw over 70,000 contacts made by the public and 10,000 crimes reported. Individual losses to fraudsters over the past 12 months totalled £93 million.

Fraud against individuals covers loss from mass-marketing fraud, lottery and advanced fee frauds, as well as new frauds such as online ticketing and rental fraud. The additional data that Action Fraud has been able to provide widened the scope of last year’s figure (£3.5billion), leading to total losses in the AFI rising to £4 billion.

Online fraud accounts for the highest number of Action Fraud reports, averaging 44% of all reported crimes. With this in mind, the NFA has been working hard to increase public awareness and provide better public protection. It recently ran a media campaign with the NFIB over the Christmas period ahead of ‘Mega Monday’, the UK’s busiest online shopping day where pre-Christmas web sales were expected to peak at £23.2 million between 12-1pm.

For more information about Action Fraud or to sign up to receive the Action Fraud e-bulletin, contact NFA.Info@attorneygeneral.gsi.gov.uk.

Action fraud / NFIB stats and operational update

In December and January the NFIB received 1,200 Action Fraud reports, with online shopping and auction fraud, advanced fee fraud and consumer non-investment fraud continuing to top the charts. Across the same time period the NFIB disseminated 565 crime reports, with total losses estimated to be more than £4.6 million. The majority of these were sent to the City of London Police and the Met Police, with West Yorkshire Police and West Midlands Police also receiving a number of reports.

Since November, NFIB crime reports have led to police investigations and arrests around the country. These include:

• The City of London Police continues to investigate a major loan repayment fraud against Finnish-based company, MCO Capital. The NFIB has processed more than 2,000 reports of people claiming their personal details have been used to apply for a cash loan that was then directed into a separate bank account. As a result of NFIB intelligence the investigating team made a series of arrests before Christmas and further action is expected in the next month.
• Northants Police has made arrests linked to a suspected corporate employee fraud and is investigating another on suspicion of online shopping and auction fraud (vehicles).
• Following a Devon and Cornwall Police investigation into online shopping and auction fraud the offender received a prison sentence.
• GMP arrested a person linked to 30 offences of online shopping and auction fraud (ticketing). He is currently awaiting sentencing.
• Trading Standards is currently investigating a suspected advanced fee fraud.
• West Midlands Police has arrested a person suspected of ten cases of online shopping and auction fraud. The investigation is ongoing.
• Kent Police currently has the suspect of a £6,000 dating scam on bail.

 Griffin Fraud

Since the launch of Griffin Fraud three conference calls have been hosted for up to 35 members. Before Christmas the NFIB provided the group with details of seasonal trends in fraud offending and the January call included a briefing on the bribery bill. Alerts on web cloners/charge backs and a report on ‘recession related frauds’ have also been produced.

The NFIB continues to identify fraudulent activity, with a recent focus on car sale fraud and loan fraud. It is also working closely with Clothes Aid to forward intelligence work on identifying and disrupting organised crime in the charity sector.