Aziz Rahman and Ben Ticehurst explain what you can do if you have fraud committed against you or your company.
Fraud is estimated to cost the UK economy £193 billion a year. And yet this is not reflected in the volume of fraud prosecutions that reach the UK’s criminal courts.
One reason for this is that, obviously, not all fraud is detected. Another is that even when fraud is detected, it is not always clear who has committed it. The result is that the number of prosecutions for fraud comes nowhere near to matching the amount of fraud that has been identified.
It is certainly true in many cases that even when a suspect is identified in connection with a fraud, the prosecuting authorities decide not to charge the person. If that person argues vehemently that they did not commit the fraud and the Crown Prosecution Service does not believe that there is sufficient evidence or that a prosecution is not in the public interest, the suspect will not be charged.
With the resources of the police and other law enforcement agencies stretched, the chances of a fraud prosecution being brought are slim at best: a report from the Centre for Counter Fraud Studies released in November 2016 stated that less than 2% of people accused of fraud are being prosecuted through the criminal justice system.
Such a situation can be hugely frustrating for the person or company that had the fraud committed against them. They could bring civil proceedings in a bid to recoup what was lost to fraud. But this does not result in the perpetrator being punished. An option that does lead to punishment, however, is bringing a private prosecution.
A private prosecution is certainly a lesser-known alternative to leaving the decision to prosecute to the authorities. But it is an equally valid way of seeking justice and is considered to be a “constitutional right”. Under the Prosecution of Offences Act 1985, any private individual, victim, interested party, charity or company in England and Wales is entitled to bring a private prosecution.
The person bringing the prosecution must have the finances to pay for it, which can deter some people from going ahead. But what has to be remembered is that once the proceedings have been completed, it is possible to recover some or all of your costs from the Ministry of Justice’s Central Funds budget.
Before a private prosecution is brought, however, it is important to prepare carefully. Seeking appropriate, expert legal advice is essential in order to both assess the chances of success of a private prosecution and then plan it and carry it out to its conclusion.
As an example, a person bringing a private prosecution does not have the evidence-gathering powers available to agencies such as the police or Serious Fraud Office (SFO). They have to consider carefully, therefore, whether they have enough evidence – or can obtain enough - to secure a successful private prosecution.
A solicitor specialising in business crime will be able to deduce the quality and admissibility of the available evidence, recognise the chances of securing a successful prosecution and identify other investigative steps that could be explored to obtain more evidence. Once all available evidence has been collected, an expert can also determine whether a private prosecution is still the best option or whether there is now enough incriminating evidence for the police to be brought in.
At Rahman Ravelli, our Corporate Fraud department works for clients who have been unable to interest the authorities in prosecuting a case. Unlike the severely under-resourced departments of the authorities, we can assemble a tailor-made team for each client to direct and oversee all aspects of an investigation and private prosecution.
Such an approach enables every aspect of a private prosecution to be developed carefully and in the best interests of a client – not given a routine assessment and then dropped, as may be the case with the police or SFO. It can ensure rapid and effective action, with all aspects of a case examined by experts and an appropriate strategy developed.
A private prosecution gives someone who has been on the “receiving end’’ of fraud a chance to gain justice without having to rely on a state prosecution. It can be less costly than civil litigation and can even be brought at the same time as civil proceedings.
In order to succeed, however, it is essential to seek the right legal advice.