Operation Podium, which focused on ticket crime during the London 2012 Games, will close at the end of March.
A Metropolitan Police report analysing findings from the operation says the closure could "create an environment that allows greater exploitation by ticket fraudsters and touts" and that Operation Podium’s work over the past two years could be lost.
The report, called Ticket Crime: Problem Profile, estimates that ticket fraud costs the economy around £40m a year. It says the lack of legislation around ticketing markets encourages "unscrupulous practices, a lack of transparency and fraud".
It calls for new legislation to outlaw to the unauthorised resale of tickets, which is not currently illegal.
The report states: "The loss of a dedicated unit, with well-established relationships and knowledge, means there is no simple policing solution, resulting in increased disenchantment on the part of victims. This clearly places the public at risk."
It adds: "Should the opportunity not be taken to pass legislation outlawing or controlling the resale of tickets, or to impose regulation across the primary and secondary ticket markets, the onus will be on the ticketing industry to regulate itself. Self-regulation is unlikely to be successful, given the current lack of transparency and unscupulous practices by some. The impetus for change may have to come from fans and performers."
Since launching in 2011, Operation Podium identified more than 200 unauthorised websites and eight fraudulent websites claiming to sell Olympic tickets, when in reality there was only one official site. It has collated a list of over 1,000 UK-based touts, and arrested 220 people for touting London 2012 Olympic tickets.
Nick Downing, detective superintendent and head of Operation Podium, said: "We know that ticket crime is extremely under reported, and there is a lack of public awareness and understanding which means that people find it difficult to distinguish between an authorised, unauthorised or fraudulent websites. For these reasons it is important that ticket crime is properly tackled and the awareness is raised on how the public can take steps to protect themselves from becoming a victim of these crimes."
Jonathan Brown of the Society of Ticket Agents and Retailers (STAR), said: "This industry has never before benefited from such concentrated work to help uncover criminality and fraud which continue to cause detriment to the ticket buying public."
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