ISSUE 53 Expert Witness Journal - Journal - Page 44
Managing Corporate Crime Risk
Under the Economic Crime and
Corporate Transparency Act 2023
by Tom Stocke, Partner - www.pinsentmasons.com
The UK’s Economic Crime and Corporate Transparency Act 2023 (the Act) has reformed the
law of corporate criminal attribution for a wide range of economic crimes and introduced a
new offence of corporate failure to prevent economic crimes.
The objective of these reforms is to make it easier to
prosecute companies for fraudulent activities and
economic crimes committed by their managers, employees, subsidiaries, and service providers. This
guide provides a summary of the reforms and their
significance.
wide to extend to regional directors and even project
managers depending on the size and importance of a
project to the organisation.
The threshold for corporate criminal attribution is
lowered for offences under a number of statutes, notably the: Theft Act 1968; Fraud Act 2006; Bribery Act
2010; Customs and Excise Management Act 1979;
Forgery and Counterfeiting Act 1981; Value Added
Tax Act 1994; Financial Services and Markets Act
2000; Financial Services Act 2012; Sanctions and AntiMoney Laundering Act 2018, in respect of money
laundering and terrorist financing; international sanctions regulations; and the Proceeds of Crime Act 2002.
A new “reasonable procedures” defence is applicable
to the failure to prevent offence. This guide provides
a methodology and template for conducting a risk assessment as part of the steps to develop a reasonable
procedures defence.
Corporate criminal attribution for economic crimes
From 26 December 2023, organisations will commit
fraud and other economic crimes if any “senior manager” commits those crimes in the discharge of their
role or in the course of their work.
This legal reform is in addition to the failure to prevent fraud offence that has been introduced and applies to all body corporates, partnerships and similar
organisational structures.
Senior managers are individuals who play a
significant role in: the making of decisions about how
the whole or a substantial part of the activities of an
organisation are managed or organised; or the actual
managing or organising of the whole or a substantial
part of those activities. The definition is sufficiently
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Why is this significant?
Organisations are significantly more exposed to committing primary economic crime offences than they
were. The previous law of corporate criminal attribution only extended corporate criminal liability for
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