What ECCTA Means for Background Checks in 2025

From 1 September 2025, the Economic Crime and Corporate Transparency Act 2023 (ECCTA) introduces a new legal obligation for UK businesses to take active steps to prevent fraud.

At the heart of the legislation is a new corporate offence: “failure to prevent fraud.” This offence makes it a criminal liability if your organisation does not have reasonable procedures in place to prevent fraud by employees, agents, or other associated persons.
At CV Insight, we help you meet these new standards with tailored Eccta background checks and fraud prevention solutions that support legal compliance and build stakeholder trust.

ECCTA: What You Need to Know

Key legal changes under ECCTA:

• Mandatory identity verification for all new company directors and Persons of Significant Control (PSCs)
• Extended corporate liability for fraud committed by any senior manager, not just board-level executives
• A new offence: failure to prevent fraud, requiring organisations to demonstrate adequate prevention procedures

Who is affected?
The new offence applies to large organisations, defined as those meeting at least two of the following thresholds:

• Over £36 million in annual turnover
• Over £18 million in total assets
• More than 250 employees

View official government guidance on who is affected

Although smaller businesses and SMEs are not currently in scope, the UK Government recommends all organisations adopt effective anti-fraud measures. This is particularly relevant for:

• FCA-regulated firms
• Financial services providers
• Businesses operating in high-risk sectors, including legal, real estate, consulting, and IT services

What HR and Compliance Teams Must Do Now
To demonstrate compliance and reduce exposure to fraud liability, you should:

• Enhance pre-employment background checks, particularly for high-risk or regulated roles
• Conduct ongoing re-checks for employees, contractors, and key third parties
• Document and standardise your internal fraud prevention procedures
• Ensure identity verification for all new directors and PSCs via Companies House
• Perform supplier and third-party due diligence across your value chain

Read the UK Government’s ECCTA fraud prevention guidance

How CV Insight Supports ECCTA Compliance
At CV Insight, we provide expert, scalable solutions that help you build a strong defence against fraud-related liability:

• Pre-employment and executive Eccta background checks
• Re-screening and compliance monitoring
• Director and PSC identity verification support
• Third-party and supplier due diligence programmes

We ensure your screening processes are fully auditable and evidence-based — giving you the ability to demonstrate “reasonable procedures”, the primary legal defence under ECCTA’s failure to prevent fraud offence.

Book Your Strategic ECCTA Compliance Review
The deadline is fast approaching. Let us help you align your hiring processes, onboarding checks, and fraud risk controls with ECCTA requirements.
Contact us today to schedule your free compliance review.

About The Author

Clare Elsworth

Clare joined the CV Insight team in 2020 following a successful Client Relationship Management and Business Development career for a leading digital services organisation. With over 20 years of experience in customer relations, Clare shares our passion and dedication to delivering a high-quality, personalised service and strives to build successful, long-lasting relationships with our clients. Alongside working closely with existing clients, Clare thoroughly enjoys a challenge and works hard to identify and build upon opportunities to drive business growth within our organisation.