Apparent Authority Under Section 250 — Where the Boundary Actually Sits

What the section text actually says

Section 250(1) of the Crime and Policing Act 2026 (c.20) reads: where a senior manager of a body corporate or a partnership commits an offence under the law of England and Wales, Scotland or Northern Ireland acting within the actual or apparent scope of their authority, the body corporate or partnership (as well as the senior manager) is to be treated as having committed the offence.

Two things follow from reading the text carefully. First, the trigger is commission of an offence by a qualifying senior manager — the s.250(3) functional test tells you who qualifies. Second, the scope gate is "actual or apparent" authority — and both limbs need to be understood.

There is no prosecution under this section yet. No UK court has interpreted what "apparent scope of their authority" means in the s.250 context. What follows is drawn from the statute text, the established agency-law doctrine the phrase imports, and the published advisory analyses of CMS Law (May 2026) and Ashurst (May 2026). These are informed assessments of where courts are likely to land; they are not settled law.

Actual scope of authority: the easier limb

"Actual authority" is the cleaner concept. A senior manager acts within their actual authority when they do something their role formally authorises them to do — through their contract, their job description, board-approved delegation matrices, or explicit sign-off from their employer. If a CFO commits fraud in the course of negotiating a deal she has been authorised to negotiate, she is clearly acting within actual scope.

CMS Law's May 2026 analysis of the attribution tests in the Crime and Policing Act noted that actual authority will cover the core of most senior managers' remits and that organisations with well-documented role mandates, board-approved delegation matrices, and clear governance frameworks will have the clearest picture of where actual authority begins and ends. The documentation point matters for more than clarity: a gap analysis that produces a clean audit trail of who has what authority creates the factual record against which the "actual" limb is measured if s.250 is ever invoked.

Apparent authority: the agency-law concept

"Apparent authority" — sometimes called ostensible authority — is a concept from English agency law. The leading case is Freeman & Lockyer v Buckhurst Park Properties [1964] 2 QB 480, where the Court of Appeal held that apparent authority arises where a principal (here: the organisation) by its conduct or words leads a third party reasonably to believe that an agent (here: the senior manager) has authority they do not in fact possess, and the third party relies on that representation to their detriment.

Applied to s.250: the question is whether the organisation has, through the way it presents the senior manager's role and authority, created a reasonable impression that the conduct was within their remit — even if it exceeded what the organisation actually authorised. This could happen where a senior manager acts in ways that are consistent with their role profile as presented externally, even if internally they exceeded their mandate.

Ashurst's May 2026 analysis of the apparent-authority limb observed that organisations that project a wide or ill-defined role mandate for senior individuals face a structurally higher apparent-authority risk: the broader the external representation of a senior manager's authority, the harder it becomes to argue that conduct was outside its apparent scope. This is particularly relevant for group structures where a senior individual is presented as having group-wide authority, and for firms whose organisational communications are vague about the limits of senior roles.

Where the boundary is likely to sit: the CMS and Ashurst analysis

Both CMS Law (May 2026) and Ashurst (May 2026) published substantive assessments of the scope gate after the Crime and Policing Act 2026 received Royal Assent.

The CMS analysis emphasised the importance of role documentation as a limiting device. Where an organisation can show — through clear delegation matrices, board-approved mandates, and job specifications — that a senior manager's formal role was narrow and well-defined, the actual-authority limb is narrowed. On apparent authority, CMS noted that the test will look at what a reasonable observer, standing outside the organisation, would infer from the organisation's own representations about the senior manager's role.

Ashurst's analysis focussed on the risk that organisations face where senior individuals are routinely described in external communications, press releases, and regulatory filings in broad terms — as "responsible for strategy", "leading firm-wide operations", or similar formulations. Where those descriptions could be interpreted to cover the conduct in question, Ashurst indicated that prosecutors and courts would likely regard that as evidence of apparent authority even if the individual had no internal authorisation to act in the relevant way.

Both analyses converged on a practical point: documenting the actual scope of senior managers' authority is not only useful for the actual-authority limb — it is also the primary available tool for limiting apparent-authority risk. An organisation that can point to a clear, dated, board-endorsed delegation matrix setting out exactly what each senior manager has authority to do — and what falls outside that authority — is better positioned than one that relies on informal understandings.

To be clear: these are advisory analyses published after Royal Assent, before any s.250 prosecution has been brought. Courts have not validated these readings. The position remains uncertain in the legal sense, and any firm facing an actual s.250 question should take independent legal advice.

The "frolic of his own" argument and its limits

Agency law recognises that an agent who goes entirely "on a frolic of his own" — acting for their own purposes in a way that has nothing to do with their role — is not acting within even apparent authority. The same principle may apply under s.250: conduct that is entirely detached from the senior manager's role, having no connection to their organisational authority, is a weaker case for attribution.

However, the bar for the frolic argument is high. Courts have historically required conduct to be substantially outside the employment relationship before the argument succeeds. Conduct that is opportunistic — using the access or position the role provides, even for personal ends — has often been treated as within apparent authority.

For s.250, this is an area where the lack of case law creates genuine uncertainty. The analogy to vicarious liability in employment law (which uses a similar range-of-authority test) suggests that courts will take a broad view of what falls within the scope of senior managerial authority, particularly where the conduct was facilitated by the position the individual held. Organisations cannot assume that a "frolic" argument will succeed in defending corporate attribution where the individual was clearly exercising the access and relationships their senior role gave them.

What this means for documentation practice

The practical takeaway from the agency-law analysis is that the scope gate in s.250(1) cuts in two directions. Good documentation of actual authority creates a factual basis for the narrower reading. But the apparent-authority limb means that external representations of a senior manager's role can expand attribution risk beyond what the documentation says.

For compliance officers, this translates to several documentation tasks. First, delegation matrices should be reviewed to ensure they accurately describe the actual scope of each senior manager's authority — and that the description is consistent with how the individual is presented externally. Second, communications (board packs, press releases, regulatory filings, organisational announcements) that describe senior managers' roles should be reviewed for inadvertent over-description of their authority. Third, the s.250(3) gap analysis population map should include a note on the scope of each individual's authority, so the analysis distinguishes between individuals with wide mandates (higher apparent-authority risk) and those with narrow functional roles.

None of this is a defence to s.250. Section 250 has no statutory defence — documented action is evidential mitigation and may be material to prosecutorial discretion. But it builds a record that reflects the actual scope of authority, which is directly relevant to what a court will consider under s.250(1) if the section is ever invoked.

The Section 250 gap analysis checklist covers how to build this record systematically from gap identification through to the board evidence pack.

Related articles

Sources

• Crime and Policing Act 2026, s.250 (c.20)www.legislation.gov.uk/ukpga/2026/20/section/250
• CMS Law — Crime and Policing Act 2026: corporate criminal liability analysis (May 2026)cms.law/en/gbr/publication/crime-and-policing-act-2026-corporate-liability
• Ashurst — Section 250 attribution: scope of authority analysis (May 2026)www.ashurst.com/en/news-and-insights/legal-updates/section-250-crime-policing-act-2026/
• Freeman & Lockyer v Buckhurst Park Properties [1964] 2 QB 480www.bailii.org/ew/cases/EWCA/Civ/1964/1.html
• FCA — Senior Managers and Certification Regimewww.fca.org.uk/firms/senior-managers-certification-regime