Offence of 'failure to prevent fraud' introduced in UK

The FTP offence was introduced in 2023 as part of the Economic Crime and Corporate Transparency Act (ECCTA), and is designed to hold large organisations to account if they profit for fraud.

Key Highlights:

• Scope of the Offence: Large organisations can be held criminally liable if an associated person commits fraud intending to benefit the organisation or its clients, unless reasonable fraud prevention procedures are in place;
• Reasonable Prevention Procedures: Organisations are advised to implement measures such as risk assessments, due diligence, and staff training to prevent fraud. The adequacy of these procedures will be evaluated based on the organisation's size, nature, and complexity; and
• Defence Mechanism: Having reasonable fraud prevention procedures can serve as a defence against prosecution. Organisations should regularly review and update these measures to ensure effectiveness.

🗓️ The FTP offence will enter into force on 1^st September 2025.

✅ Plenitude’s Fraud practice can help your firm prepare for forthcoming FTP requirement by uplifting fraud strategies, processes, controls and building robust frameworks which demonstrate effective management of fraud risks. For more information on our fraud services visit: https://www.plenitudeconsulting.com/services/fraud-prevention-services