Criminal Finances Bill finally becomes law as the Criminal Finances Act 2017 is passed

Yesterday, 27 April 2017, the hotly anticipated Criminal Finances Bill finally received Royal Assent and became the Criminal Finances Act 2017.  With it comes greater powers for law enforcement agencies to tackle tax evasion, money laundering, corruption and terrorist financing.

Here at PwC, we have been in conversation with our clients on the changes that this legislation poses for businesses for some time. Clients have understandably been focused on the corporate criminal offence of failure to prevent the facilitation of tax evasion.

In case you missed it, the key changes brought in by the new Act are:

  • Unexplained wealth orders requiring those suspected of serious criminal activity to explain the source of their funds;
  • Creates criminal liability for businesses who fail to prevent the facilitation of UK tax evasion by individuals or corporates associated persons (modelled on the UK Bribery Act 2010);
  • Greater time periods for law enforcement agencies to investigate suspicious transactions;
  • Extension of disclosure order to include investigations into money laundering and terrorist financing; and
  • Extension of civil recovery powers under the Proceeds of Crime Act 2002 to allow for recovery in the context of human right breaches both in the UK and overseas.

The passing of the Criminal Finances Act 2017  is a key element of a wider push towards tightening financial crime and anti-corruption legal and regulatory controls in the UK.  As Robert Barrington, Executive Director of Transparency International noted, the passing of the Criminal Finance Bill into law was “a good day for the fight against corruption”. In particular Barrington referred to Unexplained Wealth Orders as a tool “which will empower UK law enforcement agencies to target corrupt money flowing into the UK and more easily return it to those from whom it has been stolen”.

Many of the provisions of the Criminal Finance Act have extra-territorial reach, and it is clear that the Act is one powerful tool for law enforcement agencies and regulators. But is your business ready for the changes? Speak to any of our team who can guide you through how the Criminal Finances Act 2017 will impact on your organisation.

Keily Blair: View Keily Blair’s profile on LinkedIn            Victoria Murphy:View Victory Murphy's profile on LinkedIn