Future Retirement Success
  • Politics
  • Business
  • Investing
  • Stocks
  • Politics
  • Business
  • Investing
  • Stocks

Future Retirement Success

Business

Directors could face jail for preventing fraud within their organisations

by October 18, 2022
October 18, 2022
Directors could face jail for preventing fraud within their organisations

Company directors could be jailed for not taking appropriate measures to prevent fraud at their organisations under proposals expected to be set out this week.

MPs are due to propose an amendment to the economic crime and transparency bill which would include corporate and director-level liability for ‘failure to prevent’ criminal activity.

Two all-party parliamentary groups — on fair business banking and anti-corruption and responsible tax — are supporting the amendment, which they say is necessary to put an end to the UK being a “jurisdiction of choice for dirty money”.

The bill, introduced in the Commons last month, includes reforms such as changes to Companies House, the corporate registry, and greater powers for law enforcement agencies to tackle organised crime.

The measures were intended to build upon the earlier economic crime transparency and enforcement act, brought in following Russia’s invasion of Ukraine to make it quicker to tackle corrupt oligarchs.

However, MPs, economic crime experts and campaigners have warned that the moves do not go far enough.

The parliamentary groups want the law to be reformed so that both companies and senior executives can be held liable for criminal activities “or for failing to drive out dirty money”.

The proposed amendment would require senior executives to ensure they have proper due diligence processes at their organisations to spot and prevent their businesses being used for economic crime including fraud, money laundering, sanctions evasion and false accounting. The amendment would mirror laws already in place that carry criminal liability for failure to prevent bribery and tax evasion.

They believe the threat of prison for bosses is required to ensure the necessary culture change.

In 2020, the National Crime Agency found that money laundering causes at least £100 billion of economic damage to the UK while Spotlight on Corruption estimates that fraud represents a further £190 billion worth of damage.

Last week, Sir Robert Buckland, a barrister and the secretary of state for Wales, told a conference that such amendments could be “quite a dramatic move by parliament” but indicated that the government may be open to them.

A Law Commission report this year proposed making corporate prosecutions easier by removing the need to identify a “directing mind and will” behind wrongdoing.

In their “economic crime manifesto” report, the parliamentary groups said this “identification principle” should be replaced with “vicarious liability” to make it easier to pursue large companies for serious wrongdoing by executives or staff.

Kevin Hollinrake, chairman of the all-party parliamentary group on fair business banking, said: “Not only would such measures provide a warning to bosses who fail, wilfully or otherwise, to take proactive measures against economic crime, but it would also provide our enforcement agencies with the tools they need to hold guilty corporations to account.

“If we overlook this much-needed change, we are rolling out the red carpet for certain executives to carry on turning a blind eye to illicit finance.”

Dame Margaret Hodge, chairwoman of the all-party parliamentary group on anti-corruption and responsible tax, said the bill “tinkers around the edges” and “is a crushing disappointment”. “We will never enjoy sustained economic growth on the back of dirty money and we will never truly reform corporate culture in Britain until there is a real deterrent against bad behaviour — that means prosecutions against those at the top who fail to prevent economic crime and the real threat of going to prison.

Read more:
Directors could face jail for preventing fraud within their organisations

0
FacebookTwitterGoogle +Pinterest
previous post
Debt-stricken companies face increasing risk of credit-risk downgrades
next post
Hunt tears up government economic strategy as families face £5,000 energy bills from April

You may also like

The Power of Embedded Finance: Enhancing Traditional Financial...

March 16, 2023

Police warn shoppers to avoid fake Wilko websites

October 11, 2023

What to Consider When Investing in Property Management...

September 29, 2024

Government pledges £20bn for carbon capture and nuclear...

March 12, 2023

EU proposes €2 handling fee on online parcels...

May 21, 2025

Inventory Best Practices for Seasonal Businesses

November 5, 2024

RMT members to vote on new Network Rail...

March 9, 2023

Is it last orders for the UK craft...

May 26, 2025

Unlocking Global Opportunities: A Comprehensive Guide to E-2...

January 10, 2025

Ferguson Whisky Secures £450,000 Funding from Virgin Money...

November 21, 2024

    Get free access to all of the retirement secrets and income strategies from our experts! or Join The Exclusive Subscription Today And Get the Premium Articles Acess for Free

    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Recent Posts

    • Trump warns of ‘serious consequences’ if Elon Musk funds Democrats

      June 7, 2025
    • Musk jokes about reconsidering stance on Big Beautiful Bill after Schiff’s praise

      June 7, 2025
    • Musk deletes explosive posts about Trump and Epstein files

      June 7, 2025
    • House witness flips script on Dem who ambushed him during hearing with unearthed tweet: ‘Iceberg is ahead’

      June 7, 2025
    • Call with China’s Xi, and Trump-Musk exchange fueled barbs during 20th week in office

      June 7, 2025
    • Trump’s conservative allies warn Congress faces critical ‘test’ with $9.4B spending cut proposal

      June 7, 2025

    Categories

    • Business (8,152)
    • Investing (2,019)
    • Politics (15,568)
    • Stocks (3,136)
    • About us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: futureretirementsuccess.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 futureretirementsuccess.com | All Rights Reserved