Preventing, prosecuting and mitigating tax crimes

 

 

Tax crimes: What are the challenges?

No-FEAR Project TRI

It is very difficult for law enforcement agencies (LEAs) and policymakers to investigate and prosecute perpetrators of tax evasion as it evolves at a fast pace and often involves the collaboration of diverse actors and enablers across borders. Therefore, the prevention and prosecution of these crimes involves the coordination of a number of organizations and authorities across countries.

Differences in organizational setups, decision-making processes, infrastructure and approach can hinder the investigation and prosecution of tax crimes. For example, tinter-organisational barriers, lack of communication and information exchange, or dysfunctional incentive structures can result in failure to monitor, investigate and pursue criminals.

 

Providing solutions for the prevention and prosecution of tax crimes

How can we better investigate, prevent and mitigate corruption and tax crimes in the EU?

The PROTAX project will generate policy guidelines and toolkits to help EU tax authorities and law enforcement agencies prevent and prosecute tax crime.

The PROTAX project conducts a set of case studies of different examples of tax evasion and money laundering to assess lessons learned and the role of the human factor which can both hinder and enable tax crimes. Based on user feedback, the project will develop a:

  • Toolkit for policymakers to facilitate increased standardisation of definitions and treatment of tax crimes across different European jurisdictions
  • Toolkit for LEAs and tax authorities to depict the different types of evidence necessary for securing a conviction regarding a tax crime

Tax crime risk assessment methodology to provide practitioners with a checklist of suspicious behaviour and warning signs indicating a tax crime or money laundering

 

Ethical, legal and social impact assessment of the tax crime ecosystem

Trilateral assesses the ethical, data protection and social issues that need to be considered in the development of the PROTAX toolkit and tax crime risk assessment methodology.

Trilateral considers potential risks arising in the focus groups including treatment of whistleblowers, trade-offs between data protection, privacy and secrecy, and financial activities that may be legal but ethically questionable, creating an unexplored grey zone between tax evasion and tax avoidance.

 

Working with end-users to develop sound research

Trilateral leads the organisation of focus groups with tax authorities, policymakers, law enforcement agencies, regulatory agencies, professional bodies and enablers (e.g., lawyers, accountants, auditors, banking associations and tax advisors) to understand

  • the wide scope of methods and complex contexts in which tax crimes occur
  • best practices of law enforcement
  • gaps in regulatory frameworks
  • challenges for tax authorities, law enforcement agencies, and enablers involved in combating or in facilitating tax crime.

 

Enhancing impact: building a network to tackle tax crime

Trilateral works on enhancing the project findings by creating a network including tax authorities, policymakers, law enforcement authorities, regulatory agencies, professional bodies and enablers (e.g., lawyers, accountants, auditors, banking associations and tax advisors) and the media to reach out to all relevant stakeholders’ communities.

Our work facilitates novel collaborations, amplifying PROTAX’s results and encouraging the uptake of the PROTAX methodology and toolkit by relevant stakeholders.

 

Policy advice

Trilateral contributes to the project’s ‘responsibilisation strategy’ put forward in national legal and regulatory frameworks, combatting financial crime including tax crime.

Trilateral develops a risk assessment methodology that is specific to tax crimes. It will provide practitioners with a checklist of suspicious behaviour and warning signs indicating a tax crime or case of money laundering. The methodology will be designed for dual use, i.e., offering practical support for experts as well as serving as a training tool for enablers and professionals with reporting duties.

 

For more information and updates visit the project website and follow us on Twitter and LinkedIn.

 

 

 


The PROTAX project – New Methods to PRevent, Investigate and Mitigate COrruption and TAX Crimes in the EU – has received funding from the European Union’s Horizon 2020 research and innovation programme under grant agreement No 787098.

 

 

 

Please contact our team for more information:

Matthew Hall, Research Analyst at Trilateral Research

 

 

‘Risk Assessment Report and Methodology’

You can view the Executive Summary and Table of contents of the Project Solebay Risk Assessment Methodology Report.

Please sign up to the Solebay mailing list to download the Full Solebay project report.