Your Firm Can Be Criminally Liable for Tax Evasion You Didn't Commit. Your Only Defence Is Reasonable Prevention Procedures.
The Criminal Finances Act 2017 Sections 45 and 46 created two corporate criminal offences — failure to prevent the facilitation of UK tax evasion and foreign tax evasion. There is no intent requirement. If anyone associated with your firm — an employee, agent, intermediary, or contractor — criminally facilitates tax evasion while acting on your behalf, your firm commits the offence. The only statutory defence is proving you had reasonable prevention procedures in place. This comprehensive Tax Evasion Policy gives FCA-regulated firms a complete framework built around HM Treasury's six guiding principles — risk assessment, proportionality, top-level commitment, due diligence, communication and training, and monitoring and review — covering every aspect of a defensible prevention programme.
The burden of proof is on your firm. This policy builds the defence.
What's included: Full CFA 2017 legislative framework — Sections 45 (UK facilitation), 46 (foreign facilitation), 47 (HM Treasury guidance), 48 (associated persons definition) · Statutory defence provisions and balance of probabilities burden · Six guiding principles framework mapped to HM Treasury guidance "Tackling Tax Evasion: Government Guidance for Corporate Offences" · Corporate criminal liability chain — employees, agents, subsidiaries, third parties, associated persons · Annual firm-wide risk assessment methodology — risk identification, evaluation, control assessment, residual rating · Transaction-level risk assessment at customer onboarding · Customer CDD framework — tax residency status, tax identification numbers, source of funds, beneficial ownership · Beneficial ownership thresholds by entity type (companies/partnerships/trusts) · EDD triggers specific to tax evasion risk — offshore structures, cash-intensive businesses, complex corporates, PEPs · High-risk tax jurisdiction controls — senior management approval, tax compliance certification, enhanced monitoring · Customer review schedule by risk rating (annual/biennial/triennial) · Product and service risk assessment — three-tier framework (High/Medium/Low) covering offshore jurisdictions, special purpose vehicles, anonymous transactions, tax planning elements · Transaction monitoring — automated alerts and manual review, structuring detection, threshold evasion indicators · Four-category breach classification matrix (Minor/Moderate/Serious/Critical) with escalation timeframes (24 hours/4 hours/1 hour/immediate) · Disciplinary framework from verbal warning to summary dismissal and criminal referral · Regulatory reporting obligations — SARs to NCA, CRS reporting to HMRC by 31 May, FATCA reporting, OFSI sanctions breach reports · Third-party tax compliance warranty, prohibition clause, audit rights, and termination provisions · Six-year third-party record retention · Board oversight with annual policy approval, quarterly Risk Committee review · Three-lines-of-defence governance model · 30-day induction training standard with role-specific frequency (bi-annual for client-facing staff) · 5-year record retention standard · Ready-to-use appendix templates: customer risk assessment, product and service risk assessment, monitoring and review documentation, third-party risk assessment, product assessment matrix with RAG ratings across 20 risk criteria
Built for: Compliance officers, MLROs, SMF holders, and risk functions at FCA-regulated firms who need a CFA 2017-compliant tax evasion prevention framework that satisfies the statutory defence requirements and withstands regulatory scrutiny.
Your Firm Can Be Criminally Liable for Tax Evasion You Didn't Commit. Your Only Defence Is Reasonable Prevention Procedures.
The Criminal Finances Act 2017 Sections 45 and 46 created two corporate criminal offences — failure to prevent the facilitation of UK tax evasion and foreign tax evasion. There is no intent requirement. If anyone associated with your firm — an employee, agent, intermediary, or contractor — criminally facilitates tax evasion while acting on your behalf, your firm commits the offence. The only statutory defence is proving you had reasonable prevention procedures in place. This comprehensive Tax Evasion Policy gives FCA-regulated firms a complete framework built around HM Treasury's six guiding principles — risk assessment, proportionality, top-level commitment, due diligence, communication and training, and monitoring and review — covering every aspect of a defensible prevention programme.
The burden of proof is on your firm. This policy builds the defence.
What's included: Full CFA 2017 legislative framework — Sections 45 (UK facilitation), 46 (foreign facilitation), 47 (HM Treasury guidance), 48 (associated persons definition) · Statutory defence provisions and balance of probabilities burden · Six guiding principles framework mapped to HM Treasury guidance "Tackling Tax Evasion: Government Guidance for Corporate Offences" · Corporate criminal liability chain — employees, agents, subsidiaries, third parties, associated persons · Annual firm-wide risk assessment methodology — risk identification, evaluation, control assessment, residual rating · Transaction-level risk assessment at customer onboarding · Customer CDD framework — tax residency status, tax identification numbers, source of funds, beneficial ownership · Beneficial ownership thresholds by entity type (companies/partnerships/trusts) · EDD triggers specific to tax evasion risk — offshore structures, cash-intensive businesses, complex corporates, PEPs · High-risk tax jurisdiction controls — senior management approval, tax compliance certification, enhanced monitoring · Customer review schedule by risk rating (annual/biennial/triennial) · Product and service risk assessment — three-tier framework (High/Medium/Low) covering offshore jurisdictions, special purpose vehicles, anonymous transactions, tax planning elements · Transaction monitoring — automated alerts and manual review, structuring detection, threshold evasion indicators · Four-category breach classification matrix (Minor/Moderate/Serious/Critical) with escalation timeframes (24 hours/4 hours/1 hour/immediate) · Disciplinary framework from verbal warning to summary dismissal and criminal referral · Regulatory reporting obligations — SARs to NCA, CRS reporting to HMRC by 31 May, FATCA reporting, OFSI sanctions breach reports · Third-party tax compliance warranty, prohibition clause, audit rights, and termination provisions · Six-year third-party record retention · Board oversight with annual policy approval, quarterly Risk Committee review · Three-lines-of-defence governance model · 30-day induction training standard with role-specific frequency (bi-annual for client-facing staff) · 5-year record retention standard · Ready-to-use appendix templates: customer risk assessment, product and service risk assessment, monitoring and review documentation, third-party risk assessment, product assessment matrix with RAG ratings across 20 risk criteria
Built for: Compliance officers, MLROs, SMF holders, and risk functions at FCA-regulated firms who need a CFA 2017-compliant tax evasion prevention framework that satisfies the statutory defence requirements and withstands regulatory scrutiny.
Image 1 of 1
