UK company boards, execs could be prosecuted for tax evasion help by their staff

The boards of companies whose employees have committed fraud by helping clients to evade tax could be prosecuted for failing to stop them, under new laws reportedly being considered by UK lawmakers.

A new criminal finance bill, which has  yet to be officially unveiled, will extend the existing law – which makes companies liable only for failing to stop bribery – by “making employers responsible for preventing money-laundering, false accounting and fraud”, according to a report in today’s Times of London.

Under the planned new rules, “company boards could face prosecution for failing to prevent their staff from committing fraud”, the Times report said, noting that “a range of offences perpetrated by employees” would be included under the new measure.

“The move will bring Britain more into line with the tough approach to white-collar crime in the United States,” the Times said.

The report quoted attorney general Jeremy Wright QC,  who was quoted as telling a symposium in Cambridge on economic crime last week that ministers were planning to consult on the plans, “with a view to introducing [the] legislation”, which it noted had originally been proposed earlier in the year by then-prime minister David Cameron.

“When considering the question ‘where does the buck stop?’ and who is responsible for economic crime, it is clear the answer is to be found at every level, from the boardroom down”, the paper quotes Wright as saying.

A government source confirmed the plans, and said a consultation document would soon be released, the Times noted, quoting the source as adding: “This is the main thrust of the bill and it is in line with our priorities to improve corporate governance more generally.”

To read the Times‘s report in full on the paper’s website, click here. 

ABOUT THE AUTHOR
Helen Burggraf
Helen Burggraf is the editor of International Investment. A US-trained journalist, she has worked in Rome, New York City and London, covering everything from the fashion and retailing industries to the global drinking water and water-treatment sector, private equity, and most recently, the international cross-border financial services/advice industry.

Read more from Helen Burggraf

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