In Iceland, the claim of elves has an actual legal investigation system.

I laugh, but then I realized my hometown in Germany probably has ways to deal with various demons and monsters in a legal way. Also, evidence based systems came from witch trials in Spain. It spread throughout the countries. King James actually tried to explain it while King of Scotland.

Whether demons exist doesn't matter, it's a matter of dealing with the public and it's response to such an accusation. If you can prove it's not elves, then you can legally move forward with things and the people are satisfied.