
CPS & SFO: "Corporations must get their house in order"
TLT picks out the key points you shouldn't miss...
What’s this about?
The Crown Prosecution Service (CPS) and Serious Fraud Office (SFO) published joint updated guidance for prosecutors on corporate prosecutions, ahead of the new “failure to prevent fraud” offence coming into force on 1 September 2025.
Our Head of Risk and Financial Crime, Ben Cooper says...
“The CPS and SFO have published joint updated guidance for prosecutors on corporate prosecutions and the message is clear: the time for preparation is now. Organisations must move beyond policies on paper and demonstrate real, effective fraud prevention. The failure to prevent fraud offence and expanded identification doctrine mean that boards and senior managers will be held to account for failures in corporate governance and compliance.”
From 1 September 2025, large organisations (meeting at least two of: more than 250 employees, turnover above £36m, or balance sheet total above £18m) will be criminally liable if an employee, agent, or other associated person commits fraud for the organisation’s benefit, unless “reasonable” fraud prevention procedures are in place.
Organisations convicted under the new offence face unlimited fines. The CPS and SFO have stated that those without proper fraud prevention procedures will face severe consequences, making compliance a board-level priority.
The CPS and SFO remind corporates that they also need to be mindful of the expanded identification doctrine. The Economic Crime and Corporate Transparency Act 2023 broadens the definition of who can be considered responsible for a company’s actions. Liability can now arise from the conduct of any “senior manager” with significant decision-making or management responsibility, not just board members.
- Systems and training: Organisations must implement systems and training to prevent fraud from occurring in the first place.
- Risk-based and proportionate: Procedures should be tailored to the organisation’s risk profile and actively maintained.
- Regular review: Ongoing risk assessments, monitoring, and updates to procedures are essential.
- Whistleblowing and reporting: Accessible channels for reporting concerns must be in place.
- Due diligence: Vetting of staff, agents, and third parties is required.
The CPS and SFO encourage organisations to report fraud when discovered. Self-reporting demonstrates a commitment to responsible corporate governance and may be considered in enforcement decisions. Reports can be made to the SFO, FCA, or local police.
- Finalise and document fraud prevention procedures.
- Deliver regular staff training and awareness campaigns.
- Conduct and record risk assessments.
- Ensure senior management oversight and accountability.
- Prepare protocols for voluntary disclosure and cooperation with authorities.
- Test and audit systems regularly.
CPS and SFO leaders have warned: “Corporations must get their house in order or be ready to face investigation.” The public expects companies to be held to account for wrongdoing, and the new law removes barriers that previously made prosecution difficult.
At a glance...
CPS and SFO: "Corporations must get their house in order"
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