In 2020, the Joint Chiefs of Global Tax Enforcement, known as the J5, of which His Majesty's Revenue and Customs (HMRC) is a member, along with taxation and law enforcement agencies from Australia, Canada, Netherlands and the United States of America, carried out a global investigation known as Operation Atlantis.
The investigation revealed that certain customers of the bank appeared to be using sophisticated structures and international banking institutions and facilitators to evade tax and engage in money laundering offences.
HMRC Investigation – civil or criminal?
Simon York, the head of HMRC's Fraud Investigation and the UK's Chief of the J5, has made HMRC's position very clear:
““We have tax enquiries, criminal investigations and intelligence operations already underway involving this bank and there will be more to come. Anyone with an account at this bank should come and speak to us before we come and speak to you."
HMRC is keen for customers of the bank to come forward and disclose any tax irregularities, and are actively contacting those that they have identified by way of letters prompting or nudging the UK tax payer to review their tax returns.
Disclosure may also be made without a nudge from HMRC via their Worldwide Disclosure Facility (WDF) or its Contractual Disclosure Facility, which is more commonly referred to as a Code of Practice 9 or COP9. This facility allows individuals to make a disclosure with protection from a criminal prosecution.
However, careful consideration must be made as to which disclosure method is appropriate based on each individual case.
HMRC has already confirmed that a number of criminal investigations are also underway, and HMRC have the powers to obtain and execute search warrants, search premises, make arrests and interview people under caution with a view to criminal prosecutions.
Dependent on the amount of the under declared tax, those successfully prosecuted will most likely face lengthy custodial sentences and confiscation of assets by way of post-conviction proceedings under the Proceeds of Crime Act 2002.
How can DWF help?
The message from HMRC is clear, if you are or were a customer of the Euro Pacific Bank, then come forward and put your tax affairs in order before it is too late.
Our team can represent you and provide you with urgent advice from experienced contentious tax specialists, with expertise in making disclosures, providing representation during tax enquiries and criminal tax investigations.
Should you instruct Solicitors or Accountants – Legal Professional Privilege?
A fundamental advantage of instructing solicitors in the first instance is that all communications between us and our client are subject to Legal Professional Privilege (LPP) for the purpose of seeking or giving legal advice.
If you have any concerns or would like to discuss this further, please contact Tajinder Barring, Euros Jones or Alex Gorst.