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Criminal Law
| Question | Answer |
|---|---|
| Fraudulent trading | both civil and criminal offence |
| Fraudulent trading definition | carrying on a business with the intent to defraud creditors or for any other fraudulent purpose. |
| what do I need to identify for fraudulent trading | must be a positive act not just neglect - element of intent and dishonesty |
| Type of test - fraudulent | subjective - state of mind at time of trading and intent - difficult to prove |
| who commits fraudulent trading | usually a director - but can be others such as company secretary of financial advisor |
| Acts fraudulent trading is punishable under | fraud act 2006 and companies act 2006 |
| Fraud/companies punishment | unlimited fine and/or up to 10 years in prison |
| companies director disqualification act | if found guilty of fraud disqualified up to 15years from being a director |
| money laundering | any activity which changes the proceeds of crime into what appears to be a legitimate source of income. |
| money laundering duty | duty to report |
| failure to report | offence under proceeds of crime act 2002 - a person fails to inform their MLRO of knowledge or suspicion of money laundering. |
| failure to report punishment and defence | up to 5 years imprisonment and an unlimited fine - reasonable excuse |
| tipping off | offence under proceeds of crime act 2002 - when a person discloses to a third party that they have made a disclosure |
| tipping off punishment | up to two years imprisonment and unlimited fine |
| tipping off defence | disclosure under lawful authority or having a reasonable excuse for disclosure, along with believing it would not prejudice any investigation. |
| who has a duty to report | relevant people such as accountants duty to report knowledge or suspicion |
| who to report to | money laundering reporting officer where there is one - if not national crime agency via a suspicious activity report - e.g. sole trader |
| bribery | governed under bribery act 2010 - simplified earlier common law and statues |
| 4 offences under bribery act | -bribing another person -being bribed -bribing a foreign public official -corporate failure to prevent bribery |
| punishment bribery | up to 10 years in prison and/or unlimited fine |
| bribing another person | offence of bribing another person isn’t based on the other party accepting, only in one party offering. |
| criminal finances act 2017 | Potentially makes companies/business organisations criminally liable if their employees or agents are involved in tax evasion |
| money laundering red flags | large frequent transactions, cash deposits that cant be explained, inconsistency in info, unwilling to discuss |
| money laundering regulations 2017 purposes | 1. To enable suspicious transactions to be recognised and reported 2. In investigations, to be able to provide an audit trail |
| knowledge or suspicion | virtually certain or greater than 50% belief - staff training so are able to identify |
| confidential and privileged circumstances | The need to make a report takes precedence over confidentiality |
| defence for failing to report | Information received in privileged circumstances (by a relevant professional adviser) |
| MLR 2017 punishments | Non-compliance up to 2 years imprisonment and/or unlimited fine |
| Fraud | leads to gain for oneself and loss for a victim - fraud act 2006 |
| Fraud by false representation | Dishonestly; intending to make a gain or another to make a loss |
| Fraud by failing to disclose information | Dishonestly; intending to make a gain or another to make a loss |
| Fraud by abuse of position | Occupying a position where expected to safeguard but dishonestly abusing the position; intending to make a gain/cause a loss |
| cyber crime | computer misuse act 1990 |
| protection against cybercrime | firewalls, control access, safety settings, software updates |
| Insider dealing | • Criminal Justice Act 1993 • Dealing in securities while in possession of inside information |
| Insider dealing further offences | Encourage another to deal in them; • Disclose the information other than in proper performance |
| Insider dealing penalties | up to 7 years imprisonment and unlimited fine |
| Insider dealing defences - need to show | • Didn’t expect to make a profit (or avoid a loss) • Reasonable grounds to believe the information is widely known • Would have done what you did anyway, even without the information |
| Market abuse - civil offence | lower standard of proof - balance of probabilities |
| whistleblowing | disclosing wrongdoing of employer - public interest disclosure act 1998 |
| No obligation to whistle blow | protects individuals who do |
| requirement's to receive protection | • A qualifying disclosure of information • Made in the public interest • Made to the appropriate person |
| qualifying disclosure - one or more shown | • Criminal offence has been committed, is being committed or is likely to • Person has failed, is failing or is likely to fail any legal obligation Miscarriage of justice has occurred, occurring or is likely to |
| qualifying disclosure | • Health and safety of an individual has been, is being, likely to be endangered • Environment has been, is being, likely to be damaged • Information on any of the above has been, is being or is likely to be deliberately concealed |
| in public interest | taken to mean intention is honest • Not due to grudge, antagonism towards employer or some ulterior personal motive |
| who is disclosure made to | an appropriate person |
| protection received if can prove all elements | Right not to suffer a detriment • Employee dismissed or made redundant due to making protected disclosure shall be regarded as unfairly dismissed • Employment Tribunal compensation • Compensation no maximum limit • ‘Gagging clauses’ will be void in |
Created by:
TDuck