Archive for September, 2009
23.09.09 HMRC announce MSB online register
Posted by: BTC in HMRC News and Guidance on September 23rd, 2009
HMRC had recently sent out a letter to all Money Service Businesses (MSBs) to tell them about their intention to publish an online MSB register by the end of 2009. This register is currently being developed and will be called the MSB online registration check.
When finished it will allow for a MSB online registration check service, for both the profession and the general public to check they are dealing with a ‘registered’ firm. This is part of the supervisory strategy for policing the perimeter of the regulated sector. Those MSB firms not registered are committing an offence and this allows for checking and the subsequent reporting to HMRC of these businesses.
When the register is complete and is available HMRC will let all know through a further announcement on their website. This same process will may apply to both Trust and Company Service Providers (TCSP’s) and Accountancy Service Providers (ASP’s) in 2010 or beyond.
Visit the BTC website for compliance help and support for firms in the regulated sector
16.09.09 Four arrested connection with a £9m mortgage fraud
Posted by: BTC in General News & Cases on September 16th, 2009
Four men have been arrested by the City of London Police force in connection with a £9m mortgage fraud against a major insurance company.
40 police officers have been involved in the operation in the South-East of England which has led to a number of co-ordinated searches on four houses, the business unit of a gaming company and a solicitor’s office. Police officers have seized documents from the sites searched. As a result of the raids police have arrested four men on charges of conspiracy to defraud.
Steve Head, detective chief superintendent at the City of London Police, says the move represents a significant step forward in what has been a complex investigation.
He says: “The size of the police operation was evidence of the scale of this suspected fraud. It is not just the lenders that are being hit by the fraudsters. Individuals are losing millions and millions of pounds through a range of mortgage frauds, with much of this money being paid into the coffers of criminal networks.”
He adds: “We have a number of significant investigations ongoing and as lenders and borrowers continue to scrutinise their finances I anticipate many more cases being referred to us in the near future. I would ask anyone who has fallen victim to mortgage fraud to contact the City of London Police. The more we know the more difficult we can make it for those committing this highly damaging crime.”
The Solicitors Regulation Authority has backed the City of London Police’s crackdown on mortgage fraud.
A spokesperson says: “The SRA works closely with police and other law enforcement organisations to tackle mortgage fraud. Since the start of 2009 the SRA has stepped up its work in relation to mortgage fraud, both through advice and warnings to the profession, and by increasing its detection and investigation resources to prevent, deter and tackle fraud.”
Visit the BTC website for compliance help and support for firms in the regulated sector
14.09.09 HM Revenue and Customs officers arrested 21 people in raids in a multi million pound construction industry fraud.
Posted by: BTC in General News & Cases, HMRC News and Guidance on September 14th, 2009
The twenty one arrests, consisting of eighteen men and three women, were made covering areas as diverse as the West Midlands, Staffordshire, London and Greater Manchester. The suspects were arrested on suspicion of conspiracy to ‘cheat the public revenue’ and ‘money laundering’ offences amounting to over £6 m. They were questioned by HMRC criminal investigators at various UK police stations.
The plot centers on a complicated conspiracy through a version of ‘missing trader’ fraud which sees the creation of a contrived chain of companies, which claim to subcontract labour for the construction industry, with the sole intention of disappearing before paying the taxes due are payable under the ‘Construction Industry Scheme’ (CIS) to HMRC. These organised criminal gangs, in a bid to steal millions of pounds, pocket the money and hijack legitimate companies along the way.
This conspiracy exploits individuals working in the construction industry and it is believed thousands of construction site workers may have been robbed of the tax and national insurance contributions they have had deducted under the CIS scheme over the last six years.
Adrian Farley, Assistant Director of Criminal Investigation for HMRC, said: “Today’s arrests are the result of strenuous efforts by our teams of dedicated officers to disrupt the sophisticated scams of organised crime gangs behind money laundering activities. This conspiracy by a number of contractors is believed to have resulted in the theft of over £6 million from the public purse, depriving vital public services of much needed investment. We are committed to bringing them to justice and to deprive them of the proceeds of their crime.”
Visit the BTC website for compliance help and support for firms in the regulated sector
10.09.09 Serious Fraud Office (SFO) launches investigation into JJB and Sports Direct
Posted by: BTC in General News & Cases on September 10th, 2009
Following an OFT investigation into the sports retail market, it has been announced that the Serious Fraud Office (SFO) has now begun its own investigations into JJB Sports and Sports Direct.
JJB Sports revealed that it had stated its concerns about possible cartel activity in its market to the OFT which in turn has been granted immunity from any financial penalty in the event that competition rules have been broken.
The investigation follows an approach made by JJB to the OFT on January 30, following the suspension of its then chief executive Chris Ronnie. JJB asked at that time;
“for immunity pursuant to the OFT’s leniency programme in relation to a suspected agreement or concerted practice to dampen competition in the sports retail market in the period from 8 June 2007 to 25 March 2009, being the period in which the former chief executive, Mr Christopher Ronnie, was employed by the company.”
JJB did not name any other individuals or companies in its statement today. However, there was frequent speculation during Ronnie’s tenure about the nature of his relationship with Sports Direct and its founder Mike Ashley for whom Ronnie formerly worked.
OFT officers visited JJB at its Wigan head office this morning. It may be “some years” before the OFT investigation is complete. The retailer said in a released statement
“that in the event that any subsequent immunity agreement, is withdrawn as a result of JJB’s non-compliance with the conditions or as a result of JJB’s evidence being materially undermined in particular circumstances, and an infringement decision is issued by the OFT, JJB “may be liable for a fine from the OFT of up to a maximum amount of 10% of the Group’s turnover”.
Visit the BTC website for compliance help and support for firms in the regulated sector
09.09.09 Proposed amendments to Jersey’s Anti-Money Laundering Legislation
Posted by: BTC in International News on September 9th, 2009
The Jersey Financial Services Commission has published a consultation paper concerning proposed amendments to the ‘Money Laundering (Jersey) Order 2008’.
The Money Laundering (Jersey) Order 2008’ requires Regulated businesses to apply policies and procedures for the prevention and reporting of money laundering. These include policies and procedures for customer due diligence, record keeping, and reporting ‘suspicious activity concerning money laundering and terrorist financing.
Businesses that form the regulated sector include banks and financial institutions, money service businesses, trust and company service providers, law firms, accountants, and estate agents.
This amendment order has been made necessary in the light of some technical points that have been raised in a recent review of the Jersey framework for the prevention and detection of money laundering and terrorist financing conducted by the International Monetary Fund (IMF).
Among the proposed amendments, the paper also considers the possibility of extending powers to the Minister for Treasury & Resources to apply countermeasures where the Financial Action Task Force (FATF) issue recommendations. This may in be respect to countries or regimes that have weak or nonexistent anti-money laundering and the combating of terrorist financing legislation.
The Jersey Financial Services Commission explained on Monday that the main effects of Amendment No. 4 would be to:
- Clarify the application of customer due diligence measures to trusts and other legal arrangements;
- Clearly set out the records that a Money Laundering Compliance Officer and Money Laundering Reporting Officer must have access to in order to carry out their statutory functions;
- Require particular attention to be paid to implementing policies and procedures that are sufficient to prevent and detect money laundering and terrorist financing in subsidiaries and branches that are situated in countries and territories that do not, or insufficiently apply, the Financial Action Task Force Recommendations;
- Restate the requirement that customer information must always be collected before a relationship is established – where a customer is introduced by one business to another; and
- Amend the scope of some of the concessions that may be used when applying due diligence measures to a customer who is considered to present a low risk of money laundering or terrorist financing.
The proposed amendments have been discussed with the Commission’s Steering Group for the Prevention and Detection of Money Laundering and Terrorist Financing.
Visit the BTC website for compliance help and support for firms in the regulated sector
08.09.09 Accountant jailed for eight years for tax fraud
Posted by: BTC in General News & Cases on September 8th, 2009
John Warman who holds no qualifications to be an accountant, operated a sole practitioner practice dealing with the affairs of a number of clients. He conspired to steal £2.5m from HMRC was told by the Judge that he lived in a ‘fantasy world’ as he jailed him for eight years. John Warman drove a £165,000 Bentley Arnage and led a lifestyle of the pretence that he had substantial capital in the bank.
Judge Andrew Hamilton sentenced 70-year-old Warman, of West Bridgford, at Derby Crown Court. He told Warman, who was a self-employed accountant, that he was simply interested in using his clients to feather his own nest.
He said: “You cleverly manipulated the finances of clients in such a way that you provided yourself with a very comfortable lifestyle and could not possibly have afforded the running costs of the Bentley on his income. You ran it because you lived in this fantasy world. You took in everybody you ever dealt with.”
John Warman connived with his client, Simon Fields, who was a property tycoon to manipulate his tax returns to evade paying tax and then to pocket the proceeds.
Simon Fields, 34, of Trowell Road, Wollaton, pleaded guilty to one count of cheating the public finances to the tune of £392,000 by manipulating his business accounts. He was found guilty of one charge of conspiracy to ‘cheat the revenue’.
Warman was found guilty of that same charge and a further 28 others which 14 of them were for ‘cheating the Revenue’ and 14 further offences of obtaining money by deception. Both defendants had conspired to understate the profits from Fields’ property empire, and that of his father, Roger Fields, which John Warman also managed the tax affairs of through his practice, stealing a further £1.5m due in tax revenues.
False accounts had been prepared showing a “reduced income” and an “increased expenditure” by understating the amount received for renting out the properties, and then overstating the interest paid on loans and the amount paid for repairs and renewals. These false statements were then submitted to HM Revenue & Customs, lying about the level of profit that had been made over a eight-year period from April, 1996, to April, 2004.
Warman had also acted alone in manipulating the accounts for a second time, stealing more than £1m by further corrupting the business accounts of Roger Fields. He also stole £80,000 from three other Nottingham businesses; a farmer, a firm of solicitors and a transport company.
Visit the BTC website for compliance help and support for firms in the regulated sector
04.09.09 Netherlands Concludes TIEAs With Caribbean Islands
Posted by: BTC in International News on September 4th, 2009
In a further tightening of the net for international tax evasion, the Netherlands Ministry of Finance has announced the signing of tax information exchange agreements (TIEAs) with three Caribbean territories.
The agreements with St Kitts and Nevis, and the TIEAs with Antigua and Barbuda and St Vincent and the Grenadines, were all signed on the sidelines of the recent OECD forum.
The conventions contained with the agreements, will allow the exchange of fiscal information between the tax authorities in the case of tax crimes, and in civil tax matters.
The Netherlands Ministry of Finance noted that the agreements marked a significant step in combating tax evasion, fraud, money laundering and the financing of terrorism, as cooperation between the Netherlands and the Caribbean islands will be significantly enhanced with regard to tax matters.
The Dutch Finance Ministry revealed that it had also reached agreements for the text of further TIEAs with two more jurisdictions, namely, the Cook Islands and Samoa and that it also expects to sign a double tax treaty with Bahamas that will incorporate the internationally-agreed standard in due course.
Visit the BTC main site for more information of money laundering compliance in the regulated sector.
02.09.09 BTC to participate in HMRC Forum for TCSP’s
Posted by: BTC in General Information & FAQ's, HMRC News and Guidance, Professional Bodies on September 2nd, 2009
Steve O’Neill of Business Tax Centre has been chosen to be a part of HMRC’s supervisory forum for Trust and Company Service Providers. This is the second such forum organised by HMRC, the first being one for large money service businesses.
The forums organised by HMRC’s ‘Money Laundering Regulations Team’ meet regularly to facilitate discussions where information is shared, presentations given. These forums are to share best practice tips and ideas and to support the supervisory regime through open dialogue and engagement so that HMRC supervisory and compliance teams and the businesses they supervise can improve their compliance efforts.
The first meeting of the TCSP’s forum is to be held in London on 5th October 2009. Steve O’Neill will report back on this blog of matters arising and of supervisory ideas and best practice generated at these meetings.
Visit the BTC website for compliance help and support for firms in the regulated sector.
