Will the new Criminal Finance Bill make companies and employers criminally liable for employee’s actions?

Details of the new Criminal Finance Bill (CFB) were recently published by the Home Office on 13^th October 2016, linking the responsibility of employee actions to employers. Background checks should be considered essential and now thanks to new legal changes, they could potentially become a legal requirement in more industries than ever before. In this blog, we will look at how employers could be held responsible for the actions of their employees if they are not screened correctly – opening up some areas for serious consideration.

In May 2016 the UK Government stated that company owners within the UK would face potential prosecution if they failed to stop staff from committing fraud, money-laundering and false accounting. These factors have now been omitted from the bill while the larger economic crime version goes through a consultation process. But the new CFB regulation could still changeto reflect larger legal issues as there has yet to be any public consultation on corporate criminal offences for “failure to prevent economic crimes”.

The proposed new law could come into force as early as early as Spring 2017, with the CFB creating two new “failure to prevent” offences for corporate entities, based on the offence under section 7 of the Bribery Act 2010. The CFB could potentially change the way companies enforce background screening checks as company bosses will face accountability of a criminal offence if an associated person commits a UK or foreign tax evasion facilitation offence while acting in their capacity as an associated person of the company

The introduction of this new law will put extra pressure on recruiters and HR Directors to conduct thorough and rigorous background checks to screen for any previous criminal history or unsavoury behaviour. These checks will at least in part prevent company owners facing prosecution by screening out unsuitable candidates and help ensure any applicants hired have the capacity to abide by the relevant policies and procedures with regards to tax evasion put in place by the company.

With 38% of UK employers failing to even check if their staff have the “right to work” in the UK and only 58% of organisationsconducting any background screening checks at all, this leaves many to question how safe the recruitment process as whole in the UK really is. These figures clearly demonstrate how important screening will be for companies in the future in order to protect the company and those in senior management positions from potential prosecution in this particular circumstance. Not only this, but background checks can help protect clients and customers of any business, regardless of whether these checks are a legal requirement or not.

As a screening provider, we at CBS believe that it is critical and hugely important that background screening is conducted for any industry and for any job role in order to recruit the most suitable candidates. Failure to conduct background checks can be seen as negligent and can jeopardise your company security and reputation.  As part of our screening services, we can carry out an in-depth check of any potential criminal history, previous employment records and verify a candidate’s identity. This is a process that not only gives our clients peace of mind but has also helps mitigate the risks that come with a bad hire.

For further information, please contact our team who will be able to help guide you through the process of conducting background checks.

Tel: 01443 799 900

Email: info@cbscreening.co.uk