More funding is needed to tackle online safety for children and police must tackle fraud and restore public trust, according to a report by the Chief Inspector of Constabulary.
In his final annual report before retirement after 10 years in the job, Sir Tom Winsor said public trust in policing must be repaired and raises concerns over online crime.
Fraud is now the UK's most prevalent crime, but police treat it with an "indefensibly low priority", the Chief Inspector of Constabulary said.
Sir Tom said: "There is a tsunami of offending that can lead to catastrophic human suffering. It is difficult to investigate and is an invisible crime until an elderly person who has just lost his life savings hangs himself in his garage or throws himself off a tall building."
He added that fraud was now 53% of all crimes, but said one police force failed to investigate more than 90% of cases reported to it.
In the report he also condemned the burden put on police by "woeful" funding of mental health treatment, particularly for children.
"It is unsustainable for police to be the service of first resort in dealing with people with mental health issues," he said.
Sir Tom said public trust in the police was damaged and needed to be repaired as soon as possible.
Police must demonstrate they will not tolerate misconduct by officers and deal with it severely.
Asked about the recent case of officers at Charing Cross, London, swapping racial and misogynous messages with one another, he said the Metropolitan force was not the only one with such problems.
"We are investigating the issue and will report soon. There are a number of inquiries, but we don't have evidence that it is widespread."
He also said police must prioritise and could not investigate all crimes without increased government funding.
"The public needs to decide how much threat, harm and risk it is prepared to tolerate."
Sir Tom added that 500,000 children were at risk from danger online, including predatory paedophiles.
"Would the public tolerate low funding of those sorts of crime if they knew that figure? We used to say that children were unsafe out at night, now they are more unsafe in their own bedrooms."
And he said the traditional set up of 43 local police forces in England and Wales was no longer fit for purpose and the boundaries needed to come down to allow much more sharing of intelligence and resources.
Criminals were better at harnessing the advances in technology and the police needed to catch up, he said.