Does this hotline change the way ACCA members report?
At the start of April, HMRC launched a new hotline for reporting fraud/tax evasion and this was accompanied by an email alert which members will have received if they are subscribed to the HMRC email update service.
The email comes from HMRC Business Help and Support Emails and this is the same service that invites practitioners to other services, for instance ‘talking points’ webinars. The text of the email is:
On 4th April HMRC will launch the HMRC Fraud Hotline, a new service which will simplify the fraud reporting process. A new telephone number and online form will replace two separate tax evasion and customs hotlines.
People wishing to report fraud or evasion from 4th April will be able to contact HMRC using either:
The HMRC Fraud Hotline - on 0800 788 887 - between 8am-8pm seven days a week
A digital form which will be published on the GOV.UK website.
As well as making it easier for people to report fraud, streamlining the service will also create more time for analysis of intelligence, so cases are quickly passed into the hands of investigators.
The concern is that members receiving this email may be wondering whether their money laundering/tax evasion reporting responsibilities have changed and this new much simpler service should now be used.
Existing advice Normally relevant reports would be submitted under the Suspicious Activity Reports (SAR) regime to the National Crime Agency (NCA). Full guidance from ACCA can be found here
The key requirements are found in section 330 of the Proceeds of Crime Act 2002 (POCA): accountants should make a report if – and only if – all the three conditions below are met:
if you know or suspect, or have reasonable grounds for knowing or suspecting, that some person is engaged in money laundering
if the information on which you base your knowledge or suspicion has come to you in the course of your business (which will be, in the case of a practising accountant, your work in providing accountancy services by way of business) and
if either a) you can identify the person who you think may be engaged in money laundering or can provide information concerning the whereabouts of the laundered property or b) you believe that the information you have may assist in the identification of the person engaged in the laundering or the whereabouts of the laundered property.
Where these three conditions are met, a report must be made ‘as soon as is practicable'.
The digital form referred to in the email from HMRC is much simpler and does not contain any of the above stipulations. The details it requires are:
Section 1 – Information about the person/business
Section 2 – Information relating to their business details
Section 3 – Using this information
Section 4 – Your details
Section 5 – Submitting the form.
When completing the form it is permissible to enter part details where the full information is not known.
As part of the above, the form asks for the ‘connection’ to the person/business reported which implies that this could be used for clients. The additional help notes explain further:
Your connection with the person or business If your information relates to a business, is it one you have worked for or used? Please do not seek additional information on behalf of HM Revenue & Customs, only report what is already known to you.
So the HMRC service may give the impression that it is a substitute for the SAR regime.
Advice to members Even though the email has been sent out on email lists which include accountants who have signed up for various HMRC services, ACCA’s advice is that the existing SAR regime must still be used by accountants. The ‘light’ version of reporting to HMRC does not meet the three key requirements above and crucially there is no means of addressing the consent to act issues that the SAR report contains.
The new hotline is mainly aimed at the general public as confirmed by one of the hotline staff recently. They also confirmed that their own guidance was that accountants and other regulated sectors should continue to use the SAR regime.