Shortly before Parliament was dissolved for the June 2017 General Election campaign, Parliament passed the Criminal Finances Bill, with the result that the Criminal Finances Act 2017 (CFA) is on the U.K. statute book.
In March 2017, Guidehouse released a white paper summarizing and comparing the Bill to existing U.S. law. In this paper, Guidehouse's London team examine the CFA's new corporate criminal offences of failure to prevent the facilitation of U.K. and foreign tax evasion, and reflect on the impact the offences will have on financial institutions in the U.K.
The CFA aims to overcome the difficulties of prosecuting large multinational corporations by introducing a specific offence of failure to prevent the facilitation of tax evasion. Importantly, the guidance notes that the new offence does not alter what is criminal; it simply focuses on who is held to account for the criminal acts. It does this by focusing on the failure of the corporation to prevent crimes of those acting on or behalf of the corporation, rather than trying to attribute criminal acts to that corporation.
The offences come into force on 30 September 2017. Given the amount of work required, it is imperative that firms act now to avoid being caught out.