The Financial Conduct Authority (FCA) has seen a dramatic drop in mortgage fraud investigations, launching just one case throughout 2025. This stark figure is a far cry from the three to four probes typically opened each year leading up to this point.
Freedom of Information data obtained by client due diligence platform Thirdfort reveals that since 2018, the FCA has initiated 18 mortgage fraud investigations in total. The recent downturn in new cases is causing concern about whether regulatory bodies are equipped to tackle the increasingly complex landscape of financial crime.
The release of these figures comes shortly after the Home Office published its Fraud Strategy 2026-2029, which acknowledges that fraud is becoming a growing global issue and is rapidly evolving due to advances in technology. Olly Thornton-Berry, co-founder and CEO at Thirdfort, expressed alarm, stating that 'One FCA investigation in an entire year is a striking number and does not reflect the true scale of the problem.' While he noted that other agencies, including the National Crime Agency (NCA), Serious Fraud Office (SFO) and local police forces, also play a crucial role in combating fraud, he highlighted the 'concerning trend'.
The decline in enforcement activity coincides with a period where financial crime is becoming more sophisticated, driven in part by advancements in artificial intelligence. Thornton-Berry warned that AI is accelerating the development of increasingly convincing and complex fraudulent activities, making them 'faster, more convincing and harder to detect.' This shift poses a significant challenge for detection and prevention efforts across the sector.
As the UK housing market faces muted sales and reduced transaction volumes due to stamp duty costs, there may also be a corresponding decrease in reports of suspected mortgage fraud. The FCA's figures contrast with broader concerns about the scale of financial crime within the UK system.