Source · Select Committees · Justice Committee
Recommendation 38
38
Accepted in Part
Paragraph: 146
A 'failure to prevent fraud' offence could hold companies accountable for platform fraud.
Recommendation
A failure to prevent fraud offence should be introduced to hold companies to account for fraud occurring on their systems and encourage better corporate behaviours.
Government Response Summary
The government is actively considering the Law Commission's review on corporate criminal liability, including the creation of a failure to prevent fraud offence. Separately, the Online Safety Bill will introduce a duty for social media and search engine companies to implement systems to prevent fraud on their platforms.
Paragraph Reference:
146
Government Response
Accepted in Part
HM Government
Accepted in Part
The Government recognises that the current law on Corporate Criminal Liability does not adequately hold organisations and their senior persons to account for offences committed by the corporation and their their associated persons. In November 2020, the Government asked the Law Commission to do a thorough examination of the issue and present options for reform. This review was published in June 2022. We are working in collaboration with colleagues across Government to consider the Law Commission’s paper and determine a case for strengthening the law on corporate criminal liability, including the creation of an offence for failure to prevent fraud. Similarly, the Online Safety Bill will, for the first time, create a duty on social media and search engine companies to put into place systems and processes to prevent fraud on their platforms. Ofcom will have extensive powers to enforce this duty, including significant fines and business disruption.