Prosecution threat to firms who profit from employee fraud

BUSINESSES could be prosecuted if they profit from fraud committed by one of their employees even if managers do not know about it, under new UK laws.

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The new “failure to prevent fraud” offence, which came into effect today, holds large firms to account over their internal anti-fraud measures.

It says businesses can be held criminally liable where an employee, agent, subsidiary or other associates commit fraud intending to benefit the company, and where reasonable fraud prevention procedures were not in place.

It means they could be held to account even if managers did not order or know about the crime.