Strengthening your business against fraud: key lessons from new legislation
Fraud remains a key risk to business integrity. This article highlights the new failure to prevent fraud offence and explores practical lessons all businesses can apply.
Fraud remains one of the most persistent threats to business integrity and resilience.
This article outlines the key elements of the new failure to prevent fraud offence and explores how the principles behind it matter to all our clients.
While the legislation applies directly to larger organisations meeting specific size criteria, the principles behind it are highly relevant across the commercial landscape. The new legislation serves as a timely reminder of the value in strengthening internal controls, creating a culture of integrity, and staying ahead of emerging threats.
The new legislation at a glance
On 1 September 2025, the new failure to prevent fraud offence came into effect under the UK’s Economic Crime and Corporate Transparency Act 2023.
This offence applies to large organisations (UK-based or those with a UK connection) which meet two of the following criteria:
- More than 250 employees
- More than £36 million in turnover
- More than £18 million in total assets.
Under the new offence, organisations that meet the criteria can be held criminally liable if someone acting on their behalf commits fraud for their benefit — unless they can show they had reasonable and proportionate fraud prevention measures in place.
What this means for your business
Even if your business falls outside the scope of the new offence, adopting its core principles can help protect your people and your reputation. Key lessons include:
- Demonstrating a visible commitment from senior leadership to an anti-fraud culture
- Conducting fraud risk assessments relevant to your size and sector
- Applying proportionate controls and due diligence on employees, agents, and partners
- Communicating clearly with staff and providing training on fraud awareness
- Regularly reviewing and refining fraud prevention measures.
Fraud prevention is not just a legal consideration; it is a core value that protects your business and your stakeholders. By embedding these principles into your business, you reduce your exposure to fraud and enhance your reputation with clients and suppliers.
Our commitment to you
At Arbuthnot Latham, fraud prevention is more than a regulatory obligation – it is a reflection of our culture that is rooted in openness, integrity, and uncompromising standards. These values shape every interaction we have – with each other and with you.
We are committed to staying close to the issues that matter to you and understanding the environments you operate in. If you have any concerns about fraud and how to prevent it, please speak to your relationship manager.
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