HM Revenue and Customs (HMRC) is aggressively pursuing criminal prosecutions of those it suspects of tax evasion and financial crime.

Criminal investigations by HMRC were once preserved for criminal gangs abusing the tax system or where serious fraud was involved particularly by those in a position of trust such as accountants and solicitors.

However, the tough new stance by HMRC has seen the regulator increasingly move away from Civil Investigation of Fraud (CIF) procedures and launch criminal investigations into tax payers who have undeclared income, try and hide it offshore or are involved in deemed tax evasion schemes.

HMRC is not only targeting the architects and promotors of these schemes but also the professionals and high net worth individuals who have invested in them.

Our HMRC investigations and tax fraud solicitors have experience in advising companies, directors and high net worth individuals who are facing criminal prosecutions or investigation under the civil regime.

We act for individuals and professionals accused of non-payment of income tax and VAT as well as those involved with tax avoidance schemes such as film schemes, gift aid and EFURBS.

Our tax fraud solicitors can also assist if you are under investigation for commercial tax fraud and money laundering.

We will work closely with other professionals including accountants to help resolve matters with HMRC through the civil regime wherever possible to achieve a commercially favourable outcome. However, if you are facing criminal prosecution, we will fight hard to defend your best interests every step of the way.

HMRC will begin a criminal investigation when it suspects the following:

• Deliberate filing of inaccurate Tax Returns and VAT Returns
• Misuse of tax procedures
• VAT Missing Trader Intra-Community (MTIC) fraud
• VAT ‘Bogus’ registration repayment fraud
• Money laundering
• Deliberate concealment, forged or false documents, deception, or corruption is suspected
• Importation or exportation breaching prohibitions and restrictions
• Participation in a conspiracy with others to evade the payment of tax
• When HMRC has offered a person a Contractual Disclosure Facility (CDF) under Code of Practice 9 (COP9) but the person has either rejected the offer or has failed to follow the proper procedure (see Civil Tax Investigations)

Cases which our HMRC investigations and tax fraud solicitors have advised on include:

• Advising the lead defendant in an extremely high profile HMRC prosecution not least because, for the first time, HMRC has charged individuals involved at each commercial stage, in the £130m-plus alleged tax avoidance schemes, from the IFAs and promotors to the investors.Those charged include high profile individuals from the promoting firm together with IFAs and ex-senior partners of a Magic Circle law firm and Big Four accountancy firm
• Advising the main director of a multi-jurisdictional PLC at the inception of an HMRC enquiry. More 200 officers were deployed to raid various premises throughout the country centred on offices in Central London. The client company is a well-known and multi-national company dealing with special effects. HMRC’s investigations are worldwide and centre on what is effectively a multi-million pound VAT missing trader fraud (MITC)

• Operation Venison - advised managing director in £130m alleged international fraud prosecuted by HMRC. Resulting in a successful three month abuse of process application leading to the end of proceedings. A number of HMRC personnel were subsequently placed under criminal investigation

• R v Donnelly and others. Advised senior director and accountant of a group of companies in a multi-million pound tax fraud. HMRC alleging losses of more than £50m. The case involved complex international trading operations and multi-jurisdictional issues. The case known as Operation Vex alleged serious complex fraud charges including cheating the public revenue and money laundering

• Advised four directors under investigation by HMRC in respect of “Pension Carousel Fraud” and “Pension Liberation”. After making substantial written representations, no further action was taken against our clients, although others were prosecuted. The case against the others eventually collapsed at trial four years later

• “Mercury” Tax Investigation – Retained by prominent businessman following execution of search warrants and dawn raids by HMRC. Attended at the scene, challenging officers action and agreeing a search protocol. Later involved in challenging the lawfulness of the search warrants and supporting judicial review proceedings brought by the scheme providers of the tax mitigation scheme

• Montpellier Tax Investigation – Following dawn raids by HMRC in the UK and Isle of Man, we were instructed by a director to deal with interviews under caution and representations into allegations regarding a gift aid scheme. The case went to trial where it eventually collapsed when the Crown offered no evidence resulting in not guilty verdicts