Since our establishment twenty-seven years ago, KANGS has built a reputation of representing clients in white-collar fraud, regulatory and tax litigation matters. We have earned numerous accolades and hold the highest rankings in the prestigious legal directories such as Chambers UK and the Legal 500 where we have the coveted ‘Top Tier’ status for the defence of White Collar Crime, Fraud Litigation and Proceeds of Crime investigations.
KANGS represents a diverse array of corporate and individual clients across the spectrum of white-collar crime, including regulatory and financial fraud investigations conducted by all the leading law enforcements agencies in the UK including the SFO, FCA, HMRC, NCA and the CMA.
It is important that individuals and organisations know their rights when facing allegations of wrongdoing, and safeguarding those rights are what motivates the team at KANGS. We provide proactive guidance and assistance to clients who suspect they might be under potential investigation by police or regulatory authorities. We will also act as an interface on our client’s behalf with the police, investigators, and prosecuting authorities.
KANGS has proven success and a nationwide reputation for defending clients facing criminal prosecutions of all types including very complex fraud offences. Our renowned team provide guidance and support during the often protracted investigation stage as well as in proceedings before the Magistrates’ Court, Crown Court and Tax Tribunal.
Exploring Types of White-Collar Crime
White-collar crime typically refers to non-violent offences usually committed by individuals or organisations in business or a professional setting, and often financially motivated. These crimes are brought about by deceit, concealment, or violation of trust, and they are usually carried out by people in positions of authority or trust within corporations, government agencies, or other institutions.
Examples of white-collar crime include embezzlement, different types of fraud from bank and insurance fraud to mortgage fraud and identity theft. Money laundering, bribery and corruption, and securities fraud are often high on the list white-collar crimes, and they can have significant financial, social, and economic impacts, often resulting in substantial financial losses for victims.
Punishments for white-collar crimes can result in fines as well as imprisonment, depending on the severity of the offence.
In this focussed article we layout common types of white-collar crime often driven by the pursuit of financial gain.
Tax Fraud & HMRC Investigations
Illegally avoiding paying taxes owed to the government through misrepresentation or concealment of financial information is a typical financially driven offence. This form of white-collar crime may result in a HMRC Civil Tax Fraud Investigation.
A tax investigation is a check that HMRC performs under which it reviews the tax payment and reporting history of any self-employed individual, employee or company. HMRC, being responsible for the collection of taxes, possesses the right to perform checks on any individual or business to ensure that they pay the right amount of tax. The jurisdiction of HMRC includes all taxes, including investigations relating to:
- Capital Gains Tax
- Construction Industry Scheme (CIS)
- Corporation Tax
- Income Tax and National Insurance
- VAT
- Kittel and MTIC Investigations
The extent and severity of the investigation to be conducted by HMRC depends on the individual case. An individual or business might undergo a thorough investigation by HMRC’s Fraud Investigation Service (FIS) under either Code of Practice 8 (COP8) or Code of Practice 9 (COP9).
Financial Investigations
In short, a financial investigation is a thorough examination of financial records, transactions, and activities to uncover evidence of fraud, illegal financial activities, or other financial crimes.
It encompasses various aspects such as identifying fraud, tracing the proceeds of crime (POCA), securing orders to freeze accounts to halt suspected unlawful activities, including seizing cash and confiscating assets obtained through unlawful means.
However, standard financial investigations typically involve more commonplace and recurrent inquiries, such as:
- Existence of undeclared offshore funds and assets
- Under declaration of personal income
- Suppression of business turnover
- Non-disclosure of worldwide income
- Allegations of fraud central to the tax dispute
- Money laundering
- Bribery & Corruption
- Market Manipulation & Insider Dealing
Money laundering
The purpose of money laundering is to disguise the origins of illegally obtained funds, then integrating them back into the economy, making it appear as if came from a legal source. Money launderers often use various methods such as shell companies, false invoicing, and placing 'dirty money' into the financial system, layering it through multiple transactions to obscure its origins.
Money laundering is a serious crime because it is often associated with organised crime and the financing of terrorism. The Financial Conduct Authority (FCA) and the National Crime Agency (NCA) continually monitor financial transactions to detect and prevent illegal financial activities.
Fraud
Whether it is Securities Fraud involving individuals providing misleading information, Bank Fraud aimed at securing funding, or making false claims in Insurance Fraud, the goal remains the same. The landscape of white-collar crime continually evolves with the advent of new technology and shifts in business practices.
Securities Fraud
Securities fraud involves the financial markets, where individuals provide ambiguous or even misrepresent information to investors. This can include manipulating stock prices, making misleading disclosures or false statements.
Unsurprisingly, victims of this fraud often suffer financial losses. Instances of securities fraud can involve substantial sums, reaching into the millions of pounds.
Insurance Fraud
In short, insurance fraud is when an individual or corporation tries to deceive an insurance company to obtain a false payout. This can involve different types of deception, such as exaggerating damages, staging accidents, or providing false information on insurance claims.
Typically, we all feel the cost of insurance fraud, as the false claims lead to financial losses for insurers and higher premiums for policyholders. Depending on which Fraud Act offences have been breached, an offender can face imprisonment and/or a fine.
Bank Fraud
Bank fraud refers to the illegal act of intentionally deceiving a financial institution. A common form of bank fraud would be 'identity theft', where an offender uses someone else's personal information to open fraudulent accounts. Other forms include loan applications, and manipulating account balances, or credit card fraud where offenders use credit card information to make purchases or withdraw cash without the account owners’ consent.
In recent times, there has been a surge in tactics like coaxing individuals into sharing login credentials or transferring money to fraudulent accounts. These types of frauds have evolved over time as technology and banking methods change e.g., use of mobile banking, online banking.
Conclusion
There are numerous reasons why individuals or organisation may become involved in white-collar crime, sometimes unintentionally. However, understanding your rights is crucial. Penalties for white-collar crimes can include fines and imprisonment, depending on the seriousness of the offence.
Facing a financial investigation or prosecution can be a distressing ordeal. That is precisely why it is crucial for a criminal defence solicitor to provide discreet, sensitive, and professional service, whether representing individuals or corporations.
For further information on the types of white-collar crime mentioned above and the commitments we deliver to all our clients, please visit the KANGS website.