Financial Services Compensation Scheme  

FSCS and SFO team up to identify scams

FSCS and SFO team up to identify scams

The UK's lifeboat scheme will help the Serious Fraud Office in its fight against complex fraud by providing the government body with extensive data on pension scams, fraudulent investment schemes and the financial advisers promoting them.

The Financial Services Compensation Scheme and the Serious Fraud Office today (November 19) signed a memorandum of understanding — an agreement between parties indicating a common line of action — to work together to stamp out serious or complex fraud.

It comes during this week’s International Fraud Awareness Week.

The FSCS said it has collected a vast amount of data, insights and intelligence throughout its work compensating consumers, including information on pension liberation scams, fraudulent investment schemes and the financial advisers promoting them.

Both parties are committed to working more closely together to share intelligence and information that will assist the other to carry out their respective functions.

Through the agreement, the two bodies will “assist cooperation and coordination between the organisations” to facilitate the “effective investigation and prosecution” of fraud.

James Darbyshire, FSCS chief counsel and fraud officer, said: "Fraud undermines FSCS's remit to protect consumers and promote confidence in financial services. 

“The FSCS has a unique position in the financial services sector, both in terms of our statutory function and our insight into fraud. 

“We see many examples of cases where victims have invested their life savings into fraudulent schemes or products. We are proud to be working more closely with the SFO to meet the major challenge fraud poses to individuals, industry, and society."

Sara Lawson, SFO general counsel, said fraud and corruption subverted fair business and eroded confidence in UK companies.

She added: “It is crucial that we coordinate effectively with our domestic partners in the fight against these offences, and this memorandum sets out a clear commitment to work in the public interest with FSCS to do just that."

Scam and fraud warnings have picked up amid the coronavirus crisis, with concerns the increased number of financially vulnerable consumers from the pandemic has created a breeding ground for fraudsters.

This is not the first time regulators have teamed up to combat scams. In April, the Financial Conduct Authority partnered with the Pensions Regulator and the Money and Pensions Service to urge savers to not make any rash decisions about their pension in response to the Covid-19 crisis.

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