According to R3, bringing back criminal bankruptcy orders would allow the retrieval of funds from defendants in a more effective way than permitted under the current system.
Criminal bankruptcy charges would mean that all of the guilty person’s assets – not just proceeds from criminal activity – could be used to repay victims; it would also be easier to retrieve overseas assets.
Giles Frampton, president of R3, criticised the government’s cuts to anti-fraud agencies and called for powers held by insolvency practitioners (IPs) to be used more widely.
He said, “Insolvency practitioners already have significant powers to investigate fraud and find redress for victims.
"At the moment, these powers are only used in a limited number of situations: increasing the opportunities to use insolvency practitioners’ powers would help bring fraudsters to justice and ensure victims are properly compensated.
"Given government spending and resource cuts, it’s likely there are a number of cases involving fraud that government agencies just can’t afford to pursue."
While fraud cost the UK a massive £52bn in 2013, the Serious Fraud Office’s (SFO) budget dropped to £35m, down from £52m in 2008.
In addition to budget cuts, the powers held by IPs can be far more effective than those available to government agencies. IPs are able to target all of an individuals assets; their investigations are carried out under civil law and require a lower burden of proof; and insolvency procedures can also be concluded more quickly.