Accountants and bookkeepers have a “major opportunity” as the new Economic Crime and Corporate Transparency Act (ECCTA) rule on failure to prevent fraud comes into effect today (1 September).
The regulation holds large organisations criminally liable if an employee, agent, subsidiary, or associated person commits fraud benefitting the organisation.
Go deeper with GlobalData
Access deeper industry intelligence
Experience unmatched clarity with a single platform that combines unique data, AI, and human expertise.
Examples of fraud include dishonest sales practices, concealing crucial information from consumers or investors, or deceitful practices in financial markets.
Organisations facing prosecution must demonstrate that reasonable fraud prevention measures were in place when the fraud occurred.
Paul Lodder, VP of accounting & product strategy at Dext, a bookkeeping automation platform, highlights how this is crucial for accountants and bookkeepers.
Lodder notes that fraud prevention has not traditionally been central to their roles, but the new ECCTA guidance could change this perception.
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalData“However, accountants and bookkeepers still hold a fundamental responsibility to support their clients through any changes which may impact their business and with this in mind, there is a major opportunity for them to act as their first line of defence,” Lodder stated.
He also mentioned that fraud is becoming more sophisticated with the advent of AI, providing the example of AI-doctored receipts.
According to Lodder, technology provides accountants with essential tools to detect fraudulent activity that might escape the human eye.
“This makes it much easier to flag suspicious claims with speed and accuracy, delivering another crucial safeguard for businesses managing out-of-pocket expenses,” he explained.
Accountants and bookkeepers have access to extensive invoice databases, allowing them to identify regular transaction patterns and inconsistencies such as fraudulent supplier details.
He concluded: “Ultimately, the key to strong fraud prevention lies in not only implementing the right processes but also having multiple layers of oversight, and the accountants and bookkeepers who commit themselves towards becoming this on behalf of their clients stand to gain a major edge over their competitors.”
