Exploring the impact of the Failure to Prevent Fraud offence

The new offence of Failure to Prevent Fraud, a major development in the UK's response to fraud, finally came into force on 1 September 2025. It primarily affects large organisations (i.e., those that meet 2 out of the 3 following criteria: turnover of over £36m; balance sheet of over £18m; and over 250 employees). This includes commercial organisations but also other entities such as universities and multi-academy trusts. Smaller organisations that do not meet the size criteria are also well advised to be wary of the new offence.

Under s199 of the Economic Crime and Corporate Transparency Act (ECCTA), large organisations will be criminally liable if a person associated with the organisation commits an in-scope fraud offence. Prosecution can result in a fine (unlimited in amount), significant reputational damage and debarment from bidding for public contracts. Most large organisations will only have a defence to prosecution if they have first properly assessed their fraud risk and then designed and implemented reasonable fraud prevention measures. What is reasonable and the extent to which an organisation needs to implement measures depends on each organisation’s own risks and circumstances. A more detailed summary of the offence can be found here.

The offence of Failure to Prevent Fraud is broader than it appears and so in-scope organisations that have not assessed their risk and designed appropriate measures are now at significant risk.

We will discuss:

• What the new law is and the expectations on large organisations;
• The steps that large organisations are taking in order to protect themselves;
• The challenges that large organisations are facing;
• Initial reflections on the new offence; and
• Why large organisations (and indeed organisations of any size) should also be concerned about s196 of ECCTA and the conduct of their senior managers, and what large organisations can do to reduce their risk.

Who should attend this session?

This event will be of particular interest to anyone undertaking a management or risk and compliance role in a large organisation, a subsidiary of a large organisation, a smaller organisation that is part of the supply chain of a large organisation, or in an organisation (of any size) that is otherwise keen to reduce its fraud risk.