In theory, they definitely could have been arrested and charged for their deception when Frost first found out about it.
Although whether there would have been enough evidence to convict, even when the old man was alive, is a different matter. The guy's "confession" was not under caution. So presumably he would lawyer up, and tell a different story, about how they genuinely believed that the work needed doing, and/or how it was the old man who requested the work, and there was no trickery/lying involved.
When the old man was dead, there almost certainly was not enough evidence to convict.
But I think the point at the end was that Frost was suggesting to the grand-daughter (and she seemed to agree) that it was probably best if both side's just dropped it as far as police action was concerned. If Frost tried to prosecute the surviving lads, then they would want the girl charged for her assaults on them.
Wasnt there also some suggestion from Frost that the press might receive an anonymous tip off?
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