What are the penalties for failure to prevent fraud?
An organisation convicted of the failure-to-prevent-fraud offence is liable to an unlimited fine. There is no statutory cap; the fine is set by the court on the facts of the case.
Not sure this applies to you? The offence targets large organisations that meet the size test — check whether you are in scope.
In short
- Penalty on conviction: an unlimited fine
- No statutory cap — the court sets the amount on the facts
- Compliance evidence is weighed in prosecution and resolution decisions
Beyond the financial penalty, a conviction or investigation can carry reputational, contractual, and procurement consequences. Prosecutors also weigh a corporate's compliance programme when making charging and resolution decisions.
The offence provides a defence where the body had reasonable fraud-prevention procedures in place, or where it was not reasonable to expect procedures. DefenceFile organises the operating record that advisers and counsel rely on when evaluating that position.
The sample board pack — a one-page view of where evidence is complete and what is missing — opens in your browser, no email, no form.
Official sources
- GOV.UK failure-to-prevent-fraud factsheet
Updated 2024-03-01; accessed 2026-06-15.
- Home Office failure-to-prevent-fraud guidance v1.5
Updated 2025-10-10; accessed 2026-06-15.
- Joint CPS-SFO Corporate Prosecutions guidance
Updated 2025-11-10; accessed 2026-06-15.
Keep reading
DefenceFile organises evidence for legal and compliance review. It does not provide legal advice, create privilege, certify scope, certify reasonable procedures, or guarantee that a statutory defence will succeed.