Fraud In The Digital Age: The Independent Review’s Second Report Calls For Structural Reform Of UK Fraud Enforcement

On 14 July 2026, the Home Office published the outcome of Part Two of Jonathan Fisher KC’s Independent Review of Disclosure and Fraud Offences (the "Review") in a report titled “Fraud in the Digital Age” (the “Report”). Our earlier briefing on Part One of the Review on recommendations for improving the disclosure regime in criminal proceedings can be accessed here.

The Report includes 47 recommendations that call for structural reforms to criminal courts in dealing with economic crime cases, enhanced investigatory powers and increased collaboration across public and private sectors to address the widespread scale of fraud in the UK. Notably, the Report recommends extending the failure-to-prevent fraud offence, introduced for large organisations as of 1 September 2025, to user-to-user online platforms and technology companies that fail to prevent fraudulent content on their platforms. Lord Hanson of Flint has stated that the Government is considering the recommendations made in the Report and will respond in due course.

This briefing considers the key recommendations made in the Report and implications for businesses in the UK.

Context – challenges in UK fraud enforcement

The Report notes that fraud has grown exponentially in the last 20 years, with annual losses caused by fraud estimated at £2.3 billion. Despite fraud accounting for an estimated 44% of surveyed crime in England and Wales, only approximately 1% of reported cases result in a criminal justice outcome and there are significant delays in resolution; victims wait on average over 18 months for a charging decision and serious fraud cases take an average of 442 days from arrival at the Crown Court to completion, twice as long as the ordinary case.

Of the fraudulent activity that occurs in England and Wales, 80% is attributable to digital and internet-facilitated fraud - a proportion that continues to grow. UK Finance reports that 78% of authorised push payment fraud originates online, with three-quarters beginning on social media, and evidence before the Review suggested that in 2024 a new "crime-as-a-service" advert was placed online every second, with over 40 million such adverts posted between 2023 and 2024. 

The Report notes that the nature of fraud is also changing rapidly: AI-enabled tools are increasingly being deployed by fraudsters to generate deepfake impersonations of company executives to authorise fraudulent payments, to create synthetic identities for use in account fraud, and to produce highly convincing phishing communications at scale. A survey by the Ada Lovelace Institute found that 58% of respondents had encountered AI-enabled financial fraud: a figure that underlines the pace at which fraud is evolving beyond traditional enforcement capabilities.

A focus on structural reform

Against this backdrop, the Report diagnoses persistent structural issues hindering the UK’s approach to fraud enforcement. Key issues identified by the Report include: huge volumes of digital material, limited specialist resources, fragmented enforcement mechanisms and weak corporate accountability measures.

Whilst the Report notes that the Fraud Act 2006 remains robust and flexible, it recommends structural reform to deal with fast-moving technological advancements through which fraud is undertaken. As a result, recommendations include improvements to governance, powers, incentives, resourcing and processes, with targeted new criminal duties and offences aimed at providers of regulated user-to-user services (principally large social media platforms and comparable online intermediaries) as defined under the Online Safety Act 2023.

Key recommendations

1. New failure to prevent fraud offence and increased liability for online platforms 

The Report highlights that online platforms currently bear no direct liability to victims for losses resulting from fraudulent activity on their platforms. Whilst the Economic Crime and Corporate Transparency Act 2023 (“ECCTA”) introduced a failure to prevent fraud offence for large organisations¹ ("FTPF"), which applies to large organisations that benefit from fraud committed by their associated persons (e.g. employees, agents), the Report identifies that online platforms face no equivalent failure-to-prevent fraud liability in relation to the substantial proportion of digital fraud which is conducted by platform users.

For corporates, the direction of travel is towards more direct fraud-specific obligations, especially for online platforms and digital intermediaries, and closer scrutiny of fraud prevention systems. Most significantly, the Report recommends a new corporate criminal offence for providers of regulated user-to-user services who fail to prevent fraud on their platforms. Whilst the Report notes that the proposed offence would be closely modelled on the FTPF offence introduced under ECCTA, it is intended to be broader in scope: unlike the FTPF offence, the new offence would not be limited to fraud committed by associated persons intending to benefit the platform, but would instead address fraud committed by users of the platform, including where the platform profits from the traffic or advertising revenue generated by fraudulent content. Importantly, the Report makes clear that the new offence would not impose strict liability; rather, it would require positive steps to be taken by online platforms to implement reasonable fraud prevention procedures, tailored to the platform's size and risk profile. If adopted, major platforms’ compliance obligations will shift from reactive content takedown to demonstrable, auditable fraud-prevention systems.

In addition to a failure to prevent fraud online offence, the Report recommends an anti-fraud levy on digital and communications infrastructure providers - including social media platforms, online service providers, and other intermediaries that host or facilitate fraudulent activity. The proposed levy is analogous to the Economic Crime Levy, introduced by the Finance Act 2022, under which anti-money laundering regulated entities contribute towards the costs of tackling economic crime. Whereas the Economic Crime Levy applies to entities within the anti-money laundering-regulated sector, the proposed anti-fraud levy would target online platforms and technology companies whose services may be used to host or facilitate fraudulent activity. The levy would be calculated by reference to a provider’s advertising revenue or user-base size, with the proceeds ringfenced for fraud enforcement, public awareness campaigns and victim support. The levy would be administered by Ofcom, with a sunset clause allowing for the reduction or removal of the levy, where measurable improvements in fraud prevention, detection and cooperation with law enforcement are demonstrated.

Other recommendations in the Report include administrative powers to issue civil fines to individuals purchasing fraud-enabling products online – such as SIM farms, spoofing devices and bespoke fraud scripts.

2. Improving data and intelligence-sharing

The Report describes data-sharing as the “lifeblood” of effective fraud prevention and criminal investigations. However, the current landscape is considered fragmented, underutilised, and inconsistently applied, which in turn has created delay and hindered the progression of criminal investigations.

In the short term, the Report recommends a number of measures:

• A single memorandum of understanding between public bodies setting out how data and intelligence can be shared between agencies for the purpose of detecting and investigating fraud. This is intended to operate as a bridge until a full statutory framework is in place. 
• Clearer guidance from the Home Office, National Crime Agency ("NCA"), and Information Commissioner’s Office, on voluntary and compelled data-sharing, drawing on existing powers under the Crime and Courts Act 2013 and ECCTA to give agencies and businesses clarification on the circumstances in which agencies and private sector organisations may lawfully share data and intelligence.
• An express assurance from the NCA in guidance that lawful data-sharing will not constitute “tipping off” or “prejudicing an investigation” under the Proceeds of Crime Act 2002 (“POCA”). This recommendation appears intended to address practical barriers to information sharing between public and private organisations, including concerns that the exchange of intelligence could inadvertently disclose a specific investigative line of enquiry, within the context of a wider publicly known investigation, and expose participants to criminal liability. Such guidance would be especially welcomed following the recent Court of Appeal decision in R v Osmond [2026] EWCA Crim 979, which confirmed a broad scope of the tipping-off offence which we discuss in our article here.
• Broadening the Serious Fraud Office’s (“SFO”) information-sharing gateway to mirror the broader gateway available to the NCA. This is intended to address the current asymmetry between the SFO and NCA in multi-agency and cross-border investigations which have experienced delays and limited collaboration to combat fraudulent activity across agencies.

In the longer term, the Report recommends a comprehensive Government-wide review of data-sharing provisions across public and private sectors. The Report also recommends placing intelligence-sharing within economic crime-focused public-private partnerships on a statutory footing – a notable step that would formalise arrangements currently operating on a voluntary basis, such as the Joint Money Laundering Intelligence Taskforce which by December 2024 had identified over 10,700 previously unknown accounts, supported 391 arrests, and helped restrain £248 million in suspected criminal funds. Internationally, the Report recommends a UK-led protocol under the UN Convention against Cybercrime to recognise fraud as a priority offence, and for targeted sanctions, visa denials and the use of trade agreements and memorandums of understanding to strengthen cross-border cooperation on evidence-gathering, asset recovery and extradition.

3. Reforming investigatory powers

The Report identifies a number of significant gaps in the investigatory powers available to fraud enforcement agencies and recommends the following:

• reviewing the extraterritorial scope of the SFO’s power to compel the production of documents under section 2(3) of the Criminal Justice Act 1987, with a view to extending the power to permit service of notices on UK directors located overseas and on foreign corporates with a sufficient UK nexus.² At present, the Crime (Overseas Production Orders) Act 2019 enables the SFO, and other enforcement agencies, to compel the production of electronic data held abroad. However, those powers are contingent on the existence of a designated international cooperation agreement between the UK and the relevant jurisdiction, of which only one currently exists (with the United States). Any broader extraterritorial extension of the SFO’s section 2 powers would therefore require primary legislative reform.
• the Insolvency Service should be empowered to obtain and execute search warrants under the Police and Criminal Evidence Act 1984. This would enhance its current investigatory toolkit by enabling it to obtain and execute search warrants directly, rather than relying on other law enforcement bodies.
• powers for lay justices to authorise access to encrypted devices and data, including remotely stored information, and to increase the maximum penalty for non-compliance in fraud investigations from two years to five years’ imprisonment. 
• introducing a presumption that courts will exercise their power under section 41(7) of POCA to make repatriation orders in fraud cases.

To address the challenges associated with investigating increasingly sophisticated digital frauds, the Report recommends prioritising funding for the adoption of AI-enabled tools by law enforcement agencies to enhance the proactive detection, prevention and disruption of fraudulent activity.

4. Introducing Deferred Prosecution Agreements for individuals

The Report notes the SFO’s difficulty in translating corporate admissions made through Deferred Prosecution Agreements (“DPAs”) into successful prosecutions of individuals, citing cases such as Serco and G4S. To address this gap, it recommends exploring the introduction of a distinct statutory framework for court-supervised deferred prosecution agreements for individuals, including directors, senior managers and other employees materially implicated in serious corporate economic crime. Such a regime would operate alongside, rather than replace, existing corporate liability mechanisms and could incorporate proportionate preventative measures analogous to those available under Serious Crime Prevention Orders, such as restrictions on business dealings.

According to the Report, individual DPAs could incentivise early cooperation, facilitate asset recovery and reduce the pressure on the criminal courts by providing an alternative means of resolving appropriate cases. Increased use of both corporate and individual DPAs could also generate additional financial resources to support the UK’s response to economic crime. Accordingly, the Report recommends that a proportion of the financial penalties generated through DPAs, which are currently paid to HM Treasury, should be ring-fenced and re-invested in fraud investigation and economic crime enforcement.

5. Proposed reforms to courts, case management and early resolution

The Report recommends mechanisms for enabling early resolution of fraud prosecutions, by way of reform of the early guilty plea framework in complex fraud cases, including enhanced Goodyear indications and an increased sentence discount of up to 50% for pleas (currently a one-third reduction) entered at the earliest opportunity.

Other recommendations focus on early judicial allocation and tighter management of serious fraud trials, including the following:

• a judge should be allocated within four weeks of a case’s transfer to the Crown Court, with at least one uninterrupted week of protected reading time before arraignment. This is intended to enable effective case management and early resolution of disclosure issues from the outset, avoiding situations where judges are allocated to a case at short notice and expected to absorb vast volumes of material at speed; 
• an extension and codification of the Southwark Protocol – the intensive judicial case management framework developed for serious and complex fraud cases – into a Judicial Practice Direction applicable to all Crown Courts, bringing consistency to serious fraud case management nationwide and transforming its current non-binding guidance into binding obligations;
• a pilot scheme for low-level fraud, designed to test streamlined hearing and case management processes before wider rollout;
• enhanced judicial training including a review by the Judicial College of whether current and future judges are adequately equipped to manage complex economic crime cases, with consideration given to mandating training for judges likely to preside over such cases and broadening awareness of AI-enabled fraud and cryptocurrency-based money laundering; and 
• investment in court technology infrastructure, responding to evidence that many Crown Court centres remain ill-equipped for the overwhelmingly digital nature of fraud trials, with technical failures continuing to cause adjournments and disruption.

In terms of sentencing, the Report recommends increasing the maximum custodial penalty to 20 years for Fraud Act 2006 (“Fraud Act”) offences and for money laundering offences under POCA. The existing maximum – 10 years under the Fraud Act and 14 years under POCA – was considered no longer proportionate to the gravity and systemic impact of serious economic crime. These recommendations are not framed as a mandate for sentence inflation; rather, as a restoration of judicial discretion for the most egregious cases. Accordingly, the Report also recommends a review by the Sentencing Council of its existing guidelines in light of the proposed changes.

Significantly, and in contrast to the Government’s December 2025 proposals to restrict the availability of jury trials through the introduction of judge-only “swift courts” for serious fraud and other serious offences, the Report recommends the preservation of jury trials for serious fraud cases. In doing so, it rejects the proposition that the complexity of fraud cases is, of itself, a justification to remove juries from the trial process. The Report states that dishonesty is best assessed by a representative cross-section of the public, that the efficiency case for judge-only trials is unproven, and that removing jury trials risks perceptions of opacity and special treatment in the courts.

This recommendation could be viewed as a response to, and critique of, recent Government proposals to remove juries from serious fraud trials, rather than a recommendation for reform. In addition, the Report proposes tighter case management, strict disclosure discipline, early judicial allocation and realistic court timetables as the more effective route to resolving issues of complexity and delays associated with serious fraud prosecutions. The Report further argues that improvements in case preparation and trial management, rather than curtailment of jury trials, offer the most effective route to reducing delays in serious fraud cases. The proposed measures include tighter issues lists, a well-signposted route to verdict, firmer disclosure control from the outset, fewer interlocutory adjournments, and shorter trials, without sacrificing the public's stake in criminal justice or the legitimacy that a jury trial confers.

6. Incentivising whistleblowers

The Report recommends introducing a statutory whistleblower rewards regime for SFO investigations into serious fraud and corruption, supported by a government consultation on the design of the scheme and the use of formal written reward agreements. Such a regime could incentivise the disclosure of intelligence in complex investigations, where evidence from insiders is often critical to identifying misconduct and securing successful enforcement outcomes.

The proposal builds on the SFO’s longstanding call for the introduction of financial incentives for whistleblowers. However, previous SFO proposals for reform have attracted criticism from some legal commentators, who have questioned whether a US-style model to whistleblower incentives could encourage speculative or opportunistic reporting, complicate the assessment of witness credibility by introducing a financial motive for disclosure, and undermine the use of internal reporting and compliance channels.

To mitigate the risk of abuse, the Report also proposes the introduction of new criminal offences for knowingly making false reports and for harassing or intimidating whistleblowers. In addition, it recommends establishing an independent arbitration panel to determine appeals and complaints, providing oversight and enhancing confidence in the integrity of the regime.

7. Other recommendations

The Report contains a number of other recommendations including:

• Collection of data: that the Ministry of Justice should systematically collect and publish data on the number of individuals imprisoned for failing to satisfy a confiscation order. 
• Governance: the appointment of a cross-Government Fraud Lead to act as the overarching mechanism for holding the wider reform package together.

Commentary and next steps

As with Part One, the Government is considering the Report. The implementation of the recommendations in both Part One and Part Two will ultimately be a matter for Government, and it remains uncertain whether all, some or none of the 47 recommendations will be adopted in their current form. The proposals are broad, and some, for example DPAs for individuals and new specific offences for online platforms could represent a major shift in the current approach to law enforcement. The next stage is likely to involve a government consultation setting out the proposals it intends to explore further and inviting views from industry and other stakeholders. Nevertheless, the Report points towards a clear policy direction, namely broader information-sharing, expanded investigatory reach, greater expectations on digital intermediaries, and a more interventionist approach to fraud prevention and enforcement.

The Government’s statement expressly endorses a number of themes emerging from the Report, including: stronger upstream disruption of fraud; enhanced public-private data sharing and cooperation; increased corporate accountability; responses to risks arising from emerging technologies; greater use of deterrence measures and improvements to intelligence gathering and reporting mechanisms. For businesses, particularly user-to-user service providers and technology companies, the practical message is that the trajectory of UK fraud enforcement appears to be towards higher standards, broader regulatory reach and more direct accountability.

Key areas to watch:

• Platform liability: whether the Government legislates for the proposed failure-to-prevent fraud offence applicable to regulated user-to-user services and introduces the Ofcom-administered anti-fraud levy, as well as the timetable for implementation of any such reforms. In particular, online platforms and intermediaries should proactively assess the adequacy of their fraud prevention procedures, given the increased focus on holding such entities to account for fraudulent activity and in anticipation of potential legislative change. 
• Tipping-off guidance: whether the NCA issues guidance on when data and intelligence can be shared lawfully without giving rise to tipping-off or prejudicing an investigation offences under POCA.
• Investigatory powers: whether the SFO’s extraterritorial document production powers and its powers to obtain cloud-stored data are expanded. Against the backdrop of broader SFO reform proposals, corporates should be alert to the prospect of earlier, wider-ranging and potentially more frequent document production requests for information and data relevant to SFO investigations, including information and data held outside the UK. 
• Early resolution and sentencing: whether the increased discount for early guilty pleas is adopted and how it interacts with existing sentencing guidelines, as well as whether Parliament endorses a 20-year maximum sentence for the most serious fraud and money laundering offences. Both proposals, if enacted, could have significant implications for charging decisions, defence strategy, plea negotiations and case assessment at the pre-charge stage. 
• Whistleblower rewards: whether the Government will proceed with the introduction of a whistleblower incentivisation scheme, as advocated by the SFO, and accompanying safeguards to protect against potential abuse. If adopted, such a scheme could materially increase the volume of intelligence reported to the SFO and heighten expectations around internal reporting, escalation procedures and corporate internal investigations.
• Individual DPAs: whether this controversial proposal to introduce individual DPAs is taken forward by the Government and, if so, in what form. A related area to watch will be whether a proportion of the financial penalties generated through both corporate and individual DPAs is ring-fenced and reinvested in economic crime enforcement, thereby creating a direct link between enforcement outcomes, corporate cooperation and the resourcing of future investigations. 

Footnotes

1. Economic Crime and Corporate Transparency Act 2023, Section 199

2. This recommendation is in response to the Supreme Court’s curtailment of the SFO’s extraterritorial reach in SFO v KBR [2021] UKSC 2.

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