Failure to Prevent Fraud: Demonstrating Reasonable Procedures in Practice

This article discusses the implications of the UK's Economic Crime and Corporate Transparency Act 2023, specifically the "failure to prevent fraud" offense, which comes into effect on September 1, 2025. It emphasizes that large organizations must credibly demonstrate a proportionate, coherent, actively maintained, and dynamic fraud prevention framework to avoid liability. The piece highlights the shift from mere compliance to a governance issue requiring clear evidence of effective fraud risk management.