From 1 September 2025, the Economic Crime and Corporate Transparency Act 2023 will introduce a new offence of failure to prevent fraud, which will apply to large organisations and their subsidiaries. Organisations may be held criminally liable where an employee, agent, subsidiary or other associated person commits fraud intending to benefit the organisation. This could include, for example, dishonest sales practices, hiding important information from consumers or investors, and fraudulent practices in financial markets. The onus will be on an organisation to prove, on the balance of probabilities, that it had reasonable procedures to prevent fraud, or that it was unreasonable to expect it to have such procedures in place. This defence is based on six principles: top-level commitment; risk assessment; proportionate risk-based prevention procedures; due diligence; communication and training; and monitoring and review. The Government has published guidance on reasonable fraud prevention procedures to help employers minimise risks by developing an anti-fraud culture. Ahead of the new requirement coming into force, employers are advised to check whether they are in scope and to consider including an anti-fraud clause in employment contracts and consultancy agreements.