Briefing

The 2026 risk agenda: Top 5 predictions for the year ahead

1. Regulatory focus intensifies: Agencies race for first scalp

As the United Kingdom enters 2026, the regulatory landscape for fraud and financial crime is undergoing a marked transformation. Agencies are not only ramping up their resources and powers, but are also engaged in an implicit race to secure the first major “scalp” of the year—a high-profile conviction or settlement that will set the tone for enforcement priorities and public confidence.

The Serious Fraud Office (“SFO“), Financial Conduct Authority (“FCA“), HM Revenue & Customs (“HMRC“), and the Insolvency Service have all signalled a more assertive approach to fraud investigations. In particular, the SFO has signalled intentions to streamline self-reporting and Deferred Prosecution Agreements (“DPA“) negotiations, offering clearer expectations on timelines and cooperation. We previously wrote an article about it here. The agency’s 2025–26 Business Plan emphasises Technology Assisted Review (“TAR“), cross-border collaboration, and a willingness to deploy intrusive powers such as dawn raids and Unexplained Wealth Orders.

This is despite recent news of SFO Director Nick Ephgrave’s retirement halfway through his five-year tenure. In his short time as Director, the SFO has launched 12 new investigations, made 25 charging decisions in respect of fraud, bribery and corruption, and achieved 5 convictions.

The Home Office have also put their hat in the ring, announcing in late January that they are setting up a National Police Service, colloquially referred to as the “British FBI”, to deal specifically with organised crime, terrorism, fraud (including online fraud), and child abuse, in an effort to modernise policing. This new force will merge with the National Crime Agency (“NCA“) and is intended to work alongside existing agencies like the SFO.

Meanwhile the FCA has published its first Enforcement Watch newsletter, in which it outlines some of the factors which will lead to it opening an investigation and highlights its work with international partners to cooperate and share information to detect and disrupt crime and misconduct.

In Europe, the EU Anti-Corruption Directive has now been finalised, and EU Parliament is expected to adopt this Directive in the first half of 2026, for immediate ratification thereafter. This Directive aims to harmonise corruption offences throughout all Member States, introducing independent criminal definitions for 9 offences including ‘bribery in the public sector’, ‘bribery in the private sector’ and ‘influence peddling’. An EU-wide legal framework for corruption offences will no doubt impact aspects of criminal law, and the interplay between the EU and national criminal legal frameworks will remain to be seen.

Across the Atlantic, the US Department of Justice has launched a new Division for National Fraud Enforcement, also reflecting a major escalation in white-collar and government programme for fraud investigations.

Cross-agency coordination is accelerating case development, with whistleblower tips and data-driven referrals on the rise. The velocity and posture of enforcement are shifting, with agencies leveraging AI both as a target and a tool for fraud detection.

TIP: Do not be lulled into a false sense of security. Firms should remain vigilant around compliance. Enforcement risk remains, and in the UK, this is extremely high.

2. Geopolitical realignment: Heightened risk and opportunity

Global power dynamics are fracturing. Intensifying US–China rivalry, regional conflicts and rising protectionism are driving border tensions and deepening economic uncertainty. Europe, squeezed by American industrial protectionism and overcapacity in China, faces new tariffs, sanctions challenges and supply‑chain disruption. Together, these forces create a structurally higher‑risk geopolitical environment for 2026, with the potential for even wider disruption.

While these shifts create significant operational risks, they also present opportunities for those able to capitalise on emerging trade flows, defence spending, and shifting technology investment. Indeed, the year ahead will reward firms that identify winners and losers early, and position for a world of stickier inflation, slower growth and increasingly divergent outcomes across markets.

TIP: With the free trade era now over, tariffs, protectionism and other barriers to trade encourage those who would seek to get around them. In a case of ‘back to the future’ smuggling risk increases along with false declarations as to the contents of goods crossing borders. Authorities are doubling down on this and businesses should ensure compliance systems are geared for prevention.

3. Artificial intelligence: Game changer and litigation driver

AI adoption has hit a critical inflection point. Nearly half of firms now integrate AI into core processes, and in trading environments it is rapidly becoming indispensable for risk modelling, market analytics and compliance monitoring.

Yet, as reliance grows, so does litigation risk. Disputes are emerging over AI-driven decisions in high-value litigations, particularly where cost-cutting or algorithmic optimisation leads to errors or unintended consequences. Courts are already confronting complex questions of liability, and the year ahead is likely to see more class actions, regulatory probes and claims of “AI‑washing”, or where firms exaggerate their technological capabilities.

For commodities businesses operating across borders, governance is now the first line of defence. Regulators expect AI-driven processes to be transparent, auditable, and defensible. Compliance is no longer a back‑office function—it is a strategic shield against enforcement, disputes and reputational damage where AI meets high‑value trades and sanctions‑sensitive flows.

AI may be the game changer of 2026—but mishandled, it’s also the wildcard that can turn a competitive edge into a courtroom drama.

TIP: AI is a game changer and like many, tech developments will be used to cut costs and drive efficiency. While AI is learning fast it is still in its relative infancy and just every other learner will make mistakes. Those using it need to ensure the balance of risk/cost saving is taken into account. There will be plenty of litigation which flows from AI mistakes and no doubt fresh law about who is responsible for the mistakes when made.

4. Fraud risk rises amid economic headwinds

The fraud environment is more complex than ever, shaped by high interest rates, weak growth and rising unemployment. These pressures are driving risk‑taking and creating conditions in which financial crime thrives.

AI-driven scams and deepfake-enabled impersonation have rapidly expanded, allowing fraudsters to fabricate executives, create synthetic identities and manipulate payment flows. Trade finance and supply-chain transactions remain prime targets. At the same time, APP scams continue to compromise counterparties in high-value commodity trades.

For commodity traders and corporates, the result is heightened exposure to fraud, cyber‑enabled threats and far more assertive regulatory scrutiny.

Regulators are responding in kind. The Failure to Prevent Fraud Offence and upcoming Digital ID scheme will significantly increase corporate accountability, while the Public Authorities (Fraud, Error and Recovery) Bill signals a broader shift towards aggressive recovery and enforcement.

In 2026, fraud prevention has moved beyond compliance—it is now a strategic imperative.

TIP: Times are tough and when they are, some turn to fraud to make ends meet. There is one golden rule of what to do if you discover you have been the victim of fraud: act fast. There are legal remedies and practical steps which can be taken. The quicker they are taken, the more likely there will be successful recovery of the stolen assets.

5. Bribery risk: IFBT indicators and enforcement trends

The Serious Fraud Office and its Five Eyes partners have issued updated Indicators of Foreign Bribery and Corruption (“IFBT“)¹ to help organisations spot red flags in international transactions.

The indicators highlight patterns such as unusual payment structures, opaque ownership arrangements, excessive commissions, resistance to due diligence, irregular documentation, pressure to bypass standard procedures, unjustified PEP links and unexplained high‑value hospitality. Individually, these signs do not prove bribery, but they should trigger enhanced scrutiny and robust due diligence. The SFO encourages firms to integrate these indicators into compliance programmes, training, monitoring and reporting processes.

TIP: It is worth checking that your anti-bribery programme takes into account the latest iteration of risk factors from the SFO.

What businesses should do now

Your HFW team would be pleased to speak to you if you’d like to talk about any of the areas covered in this bulletin or get any more detail around the tips we offer.

Emma Tricco, Paralegal, assisted in the preparation of this briefing.

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