Too Good to Be True: Keeping Up with FX Fraud
September 18, 2026
Benjamin Myers KC examines the challenges presented by FX fraud and considers how the new corporate liability provisions in the Crime and Policing Act 2026 could change the enforcement landscape.
The promise of high returns and guaranteed profits from foreign exchange, cryptoassets and other commodities prove to be irresistible to investors, even when the deal is too good to be true. Foreign exchange (FX or Forex) fraud works either by dishonest manipulation of trading practice (market manipulation, insider dealing, churning accounts, money laundering) or by the well-established methods of fraud (Ponzi schemes, fake brokers, misrepresenting risk and advance fee fraud).
But FX fraud has been difficult to prosecute given the combination of international trading platforms, historic limitations on corporate liability and rapidly advancing AI. Where huge amounts of information are key, as they are in FX fraud, advancing technology enables crime to stay in front – until everyone else catches up. Successful prosecutions by the CPS of Anthony Constantiou in 2023 and Declan Nowell in 2026 are outliers. The SFO has struggled; notably shutting down a huge FX fraud investigation into allegations of price-rigging in the £3tn-a-day FX market in 2016, notwithstanding its claim that there were reasonable grounds to suspect the commission of serious and complex fraud [BBC News 15th March 2016; The Law Society Gazette 21st March 2016]. The ability of the FCA and US regulators to impose heavy fines upon corporates in this area has not been matched by the domestic ability to investigate and prosecute.
As Andrew Bailey, Governor of the Bank of England has commented, it takes expertise to tackle the exponential advance of economic crime [The Times 15th November 2026]. Investigation combined with AI-driven data analytics are elements of the response, but changes in the statutory landscape are likely also to make a significant impact so far as prosecution is concerned.
Section 250 of the Crime and Policing Act 2026, which became law on 29th June 2026, creates a quantum leap in corporate liability. Now, whenever a senior manager acting within the actual or apparent scope of their authority commits a criminal offence – any criminal offence – then the organization itself commits that offence. There is no statutory defence available; nor is there any requirement to prove a corporate benefit. But we can be sure that when it comes to confiscation, the benefit will be calculated on a corporate scale. This opens the way to prosecution of banks, institutional investors, FX brokers: any organization that falls within the terms of section 250.
This extension of corporate liability has the potential to impact upon any business. Responses include review of compliance and regulation; strengthening due diligence; staff training; updated risk management; the establishment of whistleblowing procedures – all of which are capable of militating against prosecution or mitigating the consequences of conviction. But this requires preparation in advance; not response after the event. The state’s response to FX fraud is coming, and the scale of potential confiscation will provide a powerful incentive to prosecute.
Benjamin Myers KC is a member of Exchange Chambers.
