Encouraging Businesses to Report Fraud

MQT on 2015-06-17
Session date: 
June 17, 2015
Question By: 
Roger Evans
GLA Conservatives
Asked Of: 
The Mayor


Following the statement from Metropolitan Police Service Commissioner, Sir Bernard Hogan-Howe, that businesses hide 88% of fraud to protect share prices, what steps are the Metropolitan Police Service taking to encourage businesses to report fraud?


Answer for Encouraging Businesses to Report Fraud

Answer for Encouraging Businesses to Report Fraud

Answered By: 
The Mayor

Boris Johnson MP (Mayor of London):  Thank you.  Look, Roger, Statutory Deputy Mayor Roger, thank you very much for this question.  This is something that you have taken a personal interest in, and you are absolutely right.  It is extremely important and it is not good enough that businesses are just deciding to take the soft or easy option of not reporting fraud because they want to protect either their share value or their insurance premiums or whatever it happens to be.  That is not on.  We are in this business to fight crime.  To get to grips with what is going on, when frauds are committed, they should be properly reported.  That is a view that Bernard Hogan-Howe has taken very strongly and I totally support him. 

Roger Evans AM:  Yes.  Bernard Hogan-Howe, in a speech about this, stated that he felt that only about 12% of fraud against business was reported.  Now, that is a difficult figure to measure by its very nature because we do not know the total amount of fraud that takes place, but 12% is a shockingly low figure.  Do you not think it is time that we placed some sort of instruction upon businesses to report this and give them a duty?  After all, the businesses are not the only victims of that type of fraud; it has an impact on their customers as well.

Boris Johnson MP (Mayor of London):  Yes.  Speaking as a punter, it is very noticeable that when you are defrauded in some way by somebody, there is a general tendency simply to reimburse you instantly for whatever has gone wrong but not actually to take any steps to apprehend the culprit.  It is, basically, cheaper and easier and they do not want to undermine confidence in the internet and the way it works. 

In the end, that attitude will itself undermine confidence and I would like people to report what is really going on so that people are aware of it and we can take steps to police the scene properly.  We are just at the beginning of a colossal change in the way we live caused by the web.  We need to understand it, we need to be able to police it properly and, if people are not being frank about cybercrime and what is really happening, there is no way we will be able to get to grips with it. 

Roger Evans AM:  Yes.  I always recall the episode when I had my address used to order some goods by someone who, of course, had them delivered elsewhere.  When I rang up the catalogue company to ask if they could give me the details of the person who had done this and where they had been delivered, they told me they could not because, incredibly, it would be in breach of this person’s rights under data protection.  There are some problems with the ways that business are interpreting the law at the moment because they are interpreting it in a way that is ‑‑

Boris Johnson MP (Mayor of London):  Sorry, they could not deliver the goods to the right place because that would be in breach of ‑‑

Roger Evans AM:  No, they could tell me where they had been delivered.

Boris Johnson MP (Mayor of London):  I see.  I am sorry.

Roger Evans AM:  I would have liked to have gone around and had a discussion with the person who had done it, really.

Andrew Boff AM:  That is why they did not give them to you!

Roger Evans AM:  What measures are being implemented to incentivise business, given that we cannot force them to report fraud to the police?

Boris Johnson MP (Mayor of London):  Look, it is a really difficult problem because, statutorily or legally, it is difficult to compel people to report crimes against themselves.  Philosophically, there are various issues that are raised.  It should be made absolutely clear to them that they are doing the wrong thing.  In the end, police and law enforcement agencies will be unable with keep pace with cybercrime unless they know what is really happening.  They must report it. 

Roger Evans AM:  Does Fraud and Linked Crime Online (FALCON) have a target for the amount of fraud it expects to be reported?  It seems to me at the moment we are looking at a type of crime that is under-reported and sometimes, with crime figures, we would actually like to see the numbers go up because that is evidence that people are reporting it.

Boris Johnson MP (Mayor of London):  Yes, which is one of the things we think is happening with sexual violence, rapes and crimes of domestic violence.  Look, what we are trying to do is to help companies to feel confident about reporting cybercrime, particularly small and medium enterprises (SMEs).  We are setting up a London Digital Security Centre (LDSC), which will be an independent company by July and fully operational by 2015, and it will deliver advice on digital security services to small businesses in London.  It will be a mixture of banking staff, police officers and a core team.  You can imagine, if you are one of these companies and you are a victim of cybercrime, if you need advice and you need to report it confidentially, the LDSC will be a good place to go ‑‑

Roger Evans AM:  Very good.

Boris Johnson MP (Mayor of London):  ‑‑ and a good place to bring together learnings, as we say nowadays.  Learnings.

Roger Evans AM:  ‘Learnings’?

Boris Johnson MP (Mayor of London):  Yes, bring together learnings about what is going on.

Roger Evans AM:  Yes.  We need plenty of that.  Thank you.

Boris Johnson MP (Mayor of London):  We will have learnings.