‘Failure to prevent fraud’ measures – 10% of all directors are completely unprepared for the introduction of the offence
As part of the Economic Corporate Crime and Transparancy Act (ECCTA), new measures – the ‘failure to prevent fraud’ offence – came into force today, which aims to hold large organisations accountable if they profit from fraud.
However, research from Law Debenture shows that a significant number of directors are not fully prepared.
In response to the new measures, please see a comment below from Ben Turner, managing director of Corporate Secretarial Services at Law Debenture.
Ben Turner commented:“The introduction of the ‘failure to prevent fraud’ offence, as part of the new Economic Corporate Crime and Transparency Act (ECCTA), marks a significant milestone for governance management.
“The legislation makes it crystal clear that good governance should be an absolute priority for businesses. Yet, despite the potential for seismic consequences – including criminal penalties and unlimited fines – our research shows that at least 10% of all directors are completely unprepared for the introduction of the offence*. Concerningly, more than a third (38%) are only somewhat prepared. With further ECCTA deadlines looming – including identity verification on November 18th – the impact of failing to comply cannot be understated, and businesses need to ensure they get a strong grip of their governance as a matter of urgency. Though it can be a daunting task for many businesses to face, specialist firms are on hand to guide businesses through the complex web of new legislation, to free up directors to focus on their day job.”