White collar crime ‘rampant’ as nearly 900 fraud complaints go un-investigated
NEW ZEALAND – STUFF
Reporter: Sam Sherwood August 6, 2017
Full Article: https://www.stuff.co.nz/national/crime/95319723/white-collar-crime-rampant-as-nearly-900-fraud-complaints-go-uninvestigated
Police Association President Chris Cahill said it was “not good enough” for fraud to be given such a low priority.
Businesses are spending thousands of dollars on private investigators to probe white collar crime because police won’t touch fraud cases unless they are “gold plated”, sources say.
Figures released under the Official Information Act show that as at July 28, there were 888 files where a possible fraud or deception offence had been committed, but was yet to be assigned for investigation.
One business owner who detected an alleged theft by an employee was told by police they did not have resources to initiate a prosecution.
Police Association president Chris Cahill said the number of fraud files yet to be assigned was a “total reflection” of the lack of resources and overload of work shouldered by the police’s investigative units.
Cahill said it was “not good enough” for fraud to be given such a low priority.
“A number of victims of these frauds suffer significant loss. Some of these people would have lost a significant portion of their retirement savings, a lot of these files aren’t minor files.”
National manager of financial crime Detective Senior Sergeant Iain Chapman said the number of files waiting to be assigned was “not an overwhelming figure by any stretch”. He said the number of unassigned cases varied from day to day and most of those files were yet to go through a “full assessment”.
Since February, police had prosecuted about 20 per cent of the fraud related cases reported to them, Chapman said.
Private investigator Mike Gillam is probing a case of employee embezzlement that the police said they were too stretched to take on.
FRAUD, THE CRIME TO COMMIT
Cahill said there was little deterring white-collar criminals from committing fraud.
“There’s a bit of an internal joke in police that if you’re going to commit an offence, fraud is the offence you commit for two reasons. One, the chances of being detected is incredibly low and two the chances of being sent to prison if you’re caught is low as well.”
Mike Gillam, of private investigation firm The Investigators, is investigating a case in which a business owner discovered an area manager was offering cash sales to customers, and keeping the money.
The business owner, who did not want to be identified, said he had expected that because there were written records of what was happening, including emails, it would be a “slam dunk”.
But police had told him they would not pursue the case and, if he wanted to, he would need to hire his own investigator.
“Police do not have the resources to undertake these tasks which would be necessary [to] initiate a prosecution.”
Gillam said he had “made more progress in five minutes than the police had in two months”.
The business owner said he was flabbergasted that police had not acted when he contacted them.
“What really annoys me is that we have the resources, we can get a private investigator. If you’re the local dairy or a fish and chip shop, you wouldn’t have that.”
If the police still failed to prosecute, he would take civil proceedings against the employee, who had been with the company for 13 years.
“We’re not prepared to know someone has stolen that much money from us and has walked away without even a scratch on his record.”
Sources say it’s commonplace for victims to go to police, only to be told to collate the fraud into a cohesive package.
“It needs to be gold plated before police will do anything, if anything,” a source said.
Often, they were filed prematurely because “there’s no one to do them”.
Other victims were turning to private investigators, adding extra cost to them.
Former Serious Fraud Office acting chief executive Simon McArley said investigating fraud came down to a question of economic benefit.
“The amount of money that is lost in these sort of frauds is quite significant, if you could do something about it you could do a lot for economic growth.
“Aside from the fact that these people are victims, you’re actually damaging the economy because it undermines confidence.
“It dents people’s confidence and stops them from spending money in the economy.”
Christchurch based private investigator Kevin Boyle said he had an agreement with the Christchurch criminal investigation branch supervisor that if he produced evidence of any fraud file it would be allocated to a detective for investigation, but only if the fraud involved a substantial amount of money.
Detectives around the country’s CIBs are today assigned fraud investigations alongside their rape, robbery, theft and homicide cases, which are then prioritised by their supervisors, with the aid of a computer matrix that ranks which crimes need to be investigated first.
The new public data reporting system police have launched showed how many fraud offenders were identified.
But the same database does not record the number of fraud victimisations reported to them – or their resolution rates.
The last publicly recorded fraud resolution data, contained in the old annual crime statistics releases, showed police were solving less than half of all fraud and deception crime reported to them in 2014.
Additional reporting: Susan Edmunds – Sunday Star Times