Government To Introduce New Corporate Money Laundering Offence

Legal Experts Urge Companies To Ensure They Have Adequate Internal Procedures In Place To Prevent Fraud

12.05.2016

Kate Rawlings, Press Officer | 0114 274 4238

Legal experts at national law firm Irwin Mitchell have urged companies to make sure they have adequate internal anti-fraud procedures in place after the Government announced plans for a new corporate offence for executives who fail to prevent money laundering inside their companies.

Ahead of today’s anti-corruption summit, Prime Minister David Cameron said the Government is proposing to extend a corporate failure-to-prevent law to include money laundering and fraud.

The plans mean that if an employee is charged with money laundering or fraud, their employer may be required to prove it had adequate procedures in place to prevent the financial crime or they may be deemed liable.

Today’s summit in London will be attended by the US secretary of state, John Kerry, and world leaders including Muhammadu Buhari, the Nigerian president, and Ashraf Ghani, the president of Afghanistan.

Expert Opinion
David Cameron’s proposal to widen the ‘failure to prevent’ type of corporate crime for bribery and tax evasion to include fraud, money laundering and other financial crime is a game changer. It would bring the UK’s approach closer to that of the US.

FCA-regulated firms in the financial services sector will be familiar with the requirement for effective systems and controls to prevent financial crime and face the threat of fines and public censure if they don’t have suitable measures in place.

The Prime Minister now views criminal enforcement as the tool to ensure corporate compliance in all industries, not just financial services in what is in increasingly tough approach to regulation.
Sarah Wallace, Partner