Understanding the Failure to Prevent Fraud Law
The UK’s Failure to Prevent Fraud (FTPF) law makes it a criminal offence for organisations to fail to prevent fraud committed by employees or associates for the company’s benefit. This microlesson helps employees understand how FTPF applies to their role, why there is no such thing as “small fraud,” and how every individual’s actions contribute to the organisation’s legal exposure. By learning to recognise red flags, follow reporting procedures, and uphold integrity, teams help maintain a culture of compliance, accountability, and trust.
Microlesson Description
This essential microlesson provides an overview of the UK’s new Failure to Prevent Fraud (FTPF) law and explains how a company can be held criminally liable if an employee commits fraud. It reinforces that every employee plays a crucial role in preventing fraud and that the company’s only defence is to have adequate preventative procedures in place. Learners will understand their personal responsibility in maintaining integrity and protecting the organisation from legal, financial, and reputational risk.Key Concepts
- Understand how the UK’s Failure to Prevent Fraud (FTPF) law holds organisations criminally liable for failing to prevent fraud by employees or associates
- Recognise that there is no “small fraud” — any act of dishonesty can expose the organisation to prosecution
- Learn how adequate preventative procedures serve as the company’s primary legal defence
- Identify common fraud risks, understand personal accountability, and know how and when to report concerns
Microlesson Features
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- Emtrain's Expert Answers tool, enabling employeees to submit anonymous questions about sensitive issues.
- Rich, contemporary video scences illustrating key concepts through realistic scenarios
- A data driven, skill-based approach to eLearning that establishes a shared language for employees.
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Learn through real-world examples and instructional content that highlight the do’s and don’ts of workplace interactions. Employees explore key concepts, see how different situations play out, and discover practical ways to build stronger, more respectful connections.
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Frequently Asked Questions
Below are answers to common questions that employees and managers have about this topic. These FAQs provide a preview of what you’ll learn in this microlesson and why it matters.
Q
What is the Failure to Prevent Fraud (FTPF) law?
The FTPF law is a UK regulation that makes organisations criminally liable if they fail to prevent fraud committed by employees, agents, or associates. It emphasises corporate accountability and the need for effective anti-fraud procedures.
Q
Who can be held responsible under the FTPF law?
An organisation can be prosecuted if an employee or associated person commits fraud for the organisation’s benefit and the company did not have reasonable prevention procedures in place. Individual employees may also face disciplinary or legal action for personal misconduct.
Q
What are 'reasonable procedures' under the FTPF law?
Reasonable procedures are practical steps an organisation takes to prevent fraud, such as staff training, risk assessments, and clear reporting channels. These measures must be proportionate to the organisation’s size, structure, and exposure to risk.
Q
What types of fraud does the FTPF law cover?
The law covers all forms of fraud committed by employees or agents for organisational benefit, including false accounting, misrepresentation, and bribery-related deception. The scope extends to both public and private sector entities.
Q
Why is employee awareness important in preventing fraud?
Employees are often the first to notice unusual patterns or red flags. Awareness enables early identification of potential fraud, allowing the organisation to take corrective action before significant harm occurs.
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