The Home Office has published guidance on the new corporate criminal offence of ‘Failure to Prevent Fraud’, which comes into force on 1st September 2025.
This new law, which was created by the Economic Crime and Corporate Transparency Act 2023, holds large companies criminally liable for acts of fraud committed by an employee, agent, subsidiary or other associated person for the benefit of the organisation, and where it does not have reasonable fraud prevention measures in place.
The new guidance includes:
- Which organisations are in scope
- The types of fraud covered by the offence
- What constitutes reasonable fraud prevention measures
- How the law will be enforced
- How the law overlaps with existing legislative and regulatory regimes
How can your business get prepared for the Economic Crime & Corporate Transparency Act?
- Secure C-suite buy-in. A Top-down approach is essential to ensure that fraud prevention is a c-suite priority, and that budget and resources are allocated appropriately
- Undertake a comprehensive risk assessment to get a snapshot of current fraud prevention measures and benchmark these against the requirements of the new legislation
- Create a fraud prevention plan – this should be risk-based and cover all policies, procedures, training, communications and controls
- Review monitoring and investigation processes to ensure they are adequate against the range of offences covered by the new law.
Finally, get in touch with Leverets.
We have extensive experience of acting on behalf of businesses across the full range of fraud allegations including ‘failure to prevent’ offences. We can help your business develop a fraud prevention framework that is compliant yet pragmatic.
Here’s the link to the full guidance:
