Fraud compensation orders: can victims get money back?

When someone is convicted of fraud, many victims assume the court will make sure they get their money back. In practice, the outcome depends on which order the judge makes, what the defendant still owns and how quickly enforcement moves. This article explains the main routes to fraud compensation in England and Wales, and how they compare with restitution in the United States.

Compensation orders: repayment directed to the victim

A compensation order is part of the sentence. Under the Sentencing Code, a court can require an offender to pay a victim for loss, injury or damage caused by the offence. The money goes to the victim, not to the state.

The amount must be one the court considers appropriate, taking account of what the defendant can afford. Courts have long treated these orders as best suited to straightforward cases, where the loss can be calculated easily. A single victim who paid a fixed sum to a fake builder is a typical example. A scheme with hundreds of investors and tangled accounts is much harder to fit into one order.

Magistrates' courts can only award up to £5,000 per offence. The Crown Court has no fixed upper limit, though the defendant's means still shape the result.

Confiscation orders: taking the proceeds of crime

A confiscation order works differently. Under Part 2 of the Proceeds of Crime Act 2002, the Crown Court can order a convicted defendant to pay the amount they gained from crime. If the defendant no longer has assets worth that much, the order is set at the value of what is available.

The main purpose of confiscation is to deprive offenders of their gains, not to compensate victims. Money collected is normally paid to the state, and shares are distributed between public bodies involved in enforcement. This is why asset recovery and victim repayment are not always the same thing.

How the two orders fit together

The law does give victims some priority. Where a defendant cannot pay both a compensation order and a confiscation order, the court can make the confiscation order and direct that the payments are used first to satisfy the compensation order. The defendant gets credit against the confiscation order for the sums paid to victims.

Where there are several victims, payments are shared between them. The court sets a date by which payment must be made, and some defendants pay in instalments.

Recent changes

Parliament has widened the options. Provisions in the Proceeds of Crime Act that came into force in June 2026 put greater emphasis on compensating victims and allow the court to direct that part of a confiscation sum goes to someone whose loss was not fully covered by an earlier compensation order. Southwark Crown Court has already applied the new powers in a carbon credits fraud case. A 2022 confiscation order there had found a benefit of more than £808,000 but an available amount of under £30,000, which was shared among 34 victims. The court later increased the order by almost £15,000 and directed that money to those victims.

Why victims often recover only part of the loss

Several practical problems limit what scam victims receive:

• Money has gone. Funds may have been spent, hidden, moved abroad or converted into cryptoassets.
• Means are limited. A court cannot order more than a defendant can realistically pay.
• Enforcement takes time. Restraint of assets, valuation and payment can take months or years.
• Orders may not match the loss. A confiscation figure reflects benefit and available assets, not the total harm.

A recent case shows the gap. On 28 September 2026, Southwark Crown Court made confiscation orders totalling £851,402 against two men jailed for a crypto investment fraud. The Financial Conduct Authority said that 65 investors had lost at least £1.54 million, so the orders cover roughly 55% of identified losses. The regulator said recovered funds would be returned to identified victims, but the amount actually paid depends on enforcement.

The consequences of non-payment can be serious. Defendants who fail to pay a confiscation order face a default prison sentence, but serving it does not wipe out the debt.

Other routes to getting money back

• Civil claims. A victim can sue the fraudster in the civil courts, sometimes seeking freezing orders against assets. This costs money and a judgment is only valuable if there are assets to pursue.
• Bank reimbursement. For many authorised push payment scams, where a person is tricked into sending a payment, UK payment firms now have to reimburse eligible victims up to a set limit under rules that took effect in October 2024. Eligibility depends on the circumstances.
• Prosecutor-led recovery. Some prosecutors and regulators identify victims during the case and manage repayment from recovered funds.

How restitution works in the United States

In the United States, restitution is the closest equivalent. Federal law requires courts to order restitution to identifiable victims of fraud offences, and it forms part of the criminal sentence. Forfeited assets can sometimes be returned to victims through a separate remission process. As in England and Wales, the amount ordered and the amount collected can differ widely.

What victims should do

Report the fraud promptly to the police or Action Fraud, and keep records of payments, messages and account details. If a case reaches court, tell the investigators or prosecutors about the full extent of your loss, because the figure can affect whether a compensation order is sought. Ask about the Victim Contact Scheme or the relevant victim liaison service for updates on enforcement.

A conviction does not guarantee full repayment. Compensation orders and confiscation orders can return real money to victims, particularly where assets are found early. But the final sum is often a fraction of what was lost.