THE NEW ‘failure to prevent fraud’ offence proposed by the Home Office will make it easier to prosecute a large organisation if an employee commits fraud for that organisation’s benefit. If an act of fraud is committed by an employee of an organisation, that organisation must be able to demonstrate it had reasonable measures in place to deter the offending or otherwise risk receiving an unlimited fine.

The proposed legislation, to be introduced through the Economic Crime and Corporate Transparency Bill, encourages businesses to do more to deter offending, which will help in the bid to cut crime and protect consumers, investors, other businesses and the taxpayer from fraudulent practices.

The Home Office has tabled an amendment to introduce the failure to prevent fraud offence, which is actively supported by the Serious Fraud Office and the Crown Prosecution Service (CPS).

Security Minister Tom Tugendhat observed: “We are determined to crack down on unscrupulous companies that seek to defraud their customers. Our new ‘failure to prevent fraud’ offence will protect consumers from dishonest and misleading sales practices, and also level the playing field for the majority of businesses that behave responsibly.”

Further, Tugendhat noted: “This Government is committed to fighting economic crime, as demonstrated by our recently launched Economic Crime Plan 2, which sets out how we will give law enforcement more state-of-the-art resources to tackle high-level offending.”

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