Failure to prevent fraud: expanding liability for organisations
Oct 16 2025
White Collar Crime
The new corporate offence of Failure to Prevent Fraud, which came into force on 1 September 2025 under the Economic Crime and Corporate Transparency Act 2023, marks a significant shift in corporate accountability.
In this article, Caroline Black, Consultant at Gherson Solicitors LLP, outlines the territorial scope and compliance expectations of the offence, explaining how large organisations could face prosecution where fraud by employees, agents or subsidiaries benefits the company. She also highlights the key defence available: demonstrating that reasonable fraud-prevention procedures are in place.
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