'Failure to prevent' offence to be added to new UK economic crime Bill

Thursday, 26 January 2023
A 'failure to prevent fraud' offence is to be added to the Economic Crime and Corporate Transparency Bill currently being debated in the House of Commons, Minister of State for Security Tom Tugendhat has announced.
Fraud prevention

The measure will be aimed principally at professionals such as lawyers, accountants and other intermediaries that do not have reasonable measures in place to prevent money laundering, fraud and false accounting. It is to be added to the Bill before it passes to the House of Lords, Tugendhat told MPs during the Bill's second reading.

The Bill completed its committee stage in November 2022, at which time a House of Lords committee recommended adding the failure-to-prevent offence. Since then, several MPs in the House of Commons have also urged the government to amend the Bill to create the offence.

Sir Robert James Buckland KC MP, former Secretary of State, tabled such an amendment during the second reading, creating an offence of failure to prevent fraud, false accounting or money laundering and aimed at commercial organisations or their senior managers and officers. It would also reform the underlying 'identification doctrine' generally regarded as a problem for attempts to legislate against criminal corporate behaviour. Buckland withdrew the amendment when Tugendhat promised to introduce the measure before the Lords debate.

Ministers have also debated the possibility of amending the Bill to include other provisions.


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