UK government’s £330bn coronavirus package could be targeted by criminals
The UK government’s £330bn emergency coronavirus aid package risks being targeted by organised crime, said a white collar crime lawyer.
Risks will centre around false applications for small business grants of up to £25,000 each – and boiler room fraud operations could see money evaporate as organised crime gangs game the system, the lawyer said.
Chancellor Rishi Sunak on Friday announced an unprecedented programme of support for businesses hit by the economic impact of coronavirus.
RPC white collar crime and regulatory law partner Sam Tate said we should expect organised crime both in the UK and abroad to put in multiple fraudulent applications.
So-called leakage in aid systems of 20 per cent and above is not uncommon and the low cost of technology could allow fraudsters to masquerade as legitimate UK businesses, including pretending to be real businesses or self-employed people who do not make claims, RPC said.
Tate said this is “no trivial matter given hundreds of millions of pounds are at stake and the money is needed by genuine claimants”.
Adding that: “Every major UK aid programme is targeted by fraudsters and this is the mother of all aid programmes. You can guarantee that organised crime is already looking at how they get their cut of this pie.
“In practice, the government is faced by a major dilemma – get the money out of the door to genuine claimants as quickly as possible or put in place stringent checks to stop fraudulent applications.”
RPC said it is not yet clear how the UK banking network, which is the conduit for these funds, will target money laundering of stolen money, or if the UK’s National Crime Agency will receive additional resources to combat the threat.
“So far, looking at the grant application process, it is far from clear that effective fraud prevention has been put in place. It is also unclear how the checks that exist have been tested, or even if the government will disclose fraud figures,” Tate said.