Andrew Park comments on the role of whistleblowers for HMRC in combating fraud, in the FT
Tax Investigations Partner, Andrew Park, comments on the vital role that tips from whistleblowers play in enabling HMRC to identify acts of fraud and commence investigations, in the FT.
Andrew’s comments were published in the FT, 14 October 2022, and can be found here.
“Tips from whistleblowers have long been important to HMRC in identifying potential acts of tax fraud. A quick Google now provides instant information on how to report suspected fraud to HMRC either online or by telephone.
“When HMRC is looking for buried skeletons it’s always helpful if the general public can suggest where to dig. HMRC only have so many people and so many ‘spades’. However that is not to say that all whistleblower reports are accurate. They are frequently based on mere suspicion or hearsay rather than certain knowledge. In some instances, they are even made maliciously about neighbours, divorcing spouses or current or former employers.
“The detail and quality of information that the whistleblower is able to provide and the potential size of the fraud indicated will have a big bearing on whether HMRC chooses to actively investigate or, perhaps, merely to send a generic ‘nudge letter’ indicating that HMRC has received information suggesting that the recipient is not fully compliant in a certain area – for instance, that they might have overclaimed Coronavirus support payments. Such nudge letters provide details of how the recipient can make a voluntary disclosure of anything that might need to be put right and come with the implicit threat of potential investigation if such a disclosure is not forthcoming.
“What whistleblowers cannot expect is to be kept informed by HMRC on what is done with their information. HMRC follow strict taxpayer confidentiality and barring being called as a witness in any potential criminal prosecution whistleblowers are likely to have no further contact with HMRC after making the report. They might find that frustrating but it is only right and proper.”