Due Diligence

Due diligence is the phrase used to describe the systems, procedures and records that you have in your business to ensure that you are legally compliant.  It includes the training of your employees, the internal arrangements you have for checking and auditing compliance, any external support you may make use of, the process you follow when something goes wrong, and importantly the compliance documentation you keep to demonstrate the activities you have undertaken.

By putting in adequate systems to ensure that your business operates effectively and compliantly you can limit the risk of errors occurring but something will inevitably go wrong at some point in your business and it is at this point that your due diligence systems will really be put to the test.  For example if an advert is non-compliant, or incorrect advice is provided, you should be able to demonstrate that you had done everything that could be reasonably expected to prevent it from occurring.  This means that your systems should be adequate and your records should demonstrate that those systems are being followed.  If you have failed to do either of those things you will not be able to demonstrate due diligence.

By ensuring you have appropriate due diligence you can be safe in the knowledge that you are mitigating the risk of being prosecuted by the Office of Fair Trading or Trading Standards for any breach of consumer protection legislation.

If you need help in meeting your compliance obligations or you are facing enforcement action that could jeopardise your business please visit www.scottrobertllp.com for professional support or contact Scott Robert LLP on 0844 736 5327.