Courts in the UK may allow companies to be convicted of crimes even if no employees are criminally responsible

With gaps remaining despite recent reforms to corporate criminal law in the UK, University of Surrey academics are calling for a new legal approach that could hold companies liable for economic crimes even where a single employee lacks the mental state required for conviction.

In the following cases senior managers If the flow of information within the company is deliberately interfered with to prevent any individual from having sufficient knowledge to commit a crime, the “common knowledge” of the company’s employees can be used to obtain a conviction.

study, which visible inside Oxford Journal of Legal StudiesIt examines the limitations of the UK’s Economic Crime and Corporate Transparency Act 2023. While the law introduces important reforms, such as the expansion of the identification doctrine, Professor Alexander Sarch argues that these changes are insufficient to address complex forms of corporate misconduct aimed at avoiding liability. company.

To demonstrate this, the study examines scenarios involving complex efforts to avoid corporate liability: Consider a company that files a false report with a regulatory agency. There is no single worker He is aware of the false statements in the report.

However, different employees have pieces of information that, when put together, would reveal the fraudulent nature of the report, but which these employees are deliberately prevented from sharing through reasonable means. While the company benefits from this deception, no employee can be held criminally liable.

Alexander Sarch, lead author of the study and Professor of Legal Philosophy at the University of Surrey, said: “To deal with efforts to evade criminal liability by interfering with the normal flow of information within a company, I propose that we combine fragmented information so that employees can create a separate ‘corporate male real’ (expressing the criminal mind of a company). It needs to create a legal term that

“This approach, known as the ‘collective knowledge doctrine’, is not without controversy. However, I argue that its application would yield significant benefits if limited to the following situations: senior management “He is clearly interfering with the flow of information to avoid legal consequences.”

The article focuses on scenarios where senior managers, aware of potential abuses, create information barriers within their organizations to prevent any employees from gaining a full understanding of the criminal activity in question. This intentional compartmentalization of information allows the company to claim ignorance and risk causing harm or being criminally charged.

Professor Sarch continues: “Despite much-welcomed reforms to expand corporate criminal liability in the Economic Crime and Corporate Transparency Bill 2023, existing law struggles to address situations where corporate structures have been deliberately constructed to conceal knowledge of wrongdoing.

“My research suggests that prosecutors should urge courts to apply the ‘collective information doctrine’ to extreme cases of fraud involving information misuse within companies. When applied judiciously, the collective information doctrine can be a powerful tool for holding companies accountable in these complex cases.”

The research uses legal, conceptual and doctrinal methodologies, analyzing realistic scenarios to test the limits of existing legislation and legal precedents. This approach clarifies the legal arguments prosecutors can use in the case and provides a framework for courts to consider when dealing with similar real-life situations.