In what are thought to be the first probes of their kind, tax officials and prosecutors have started targeting gangland bank accounts in jurisdictions such as Gibraltar, the Isle of Man and Liechtenstein.
HM Revenue and Customs and the Crown Office have sent numerous “request letters” to authorities in tax havens currently under huge political pressure to co-operate with authorities in the UK and other states.
These documents were the first stage in opening cross-jurisdictional tax-evasion investigations.
HMRC can conduct two kinds of criminal investigation into offshore tax evasion, the cost of which to the Treasury could be up to £15 billion a year. The first is when it believes gangsters are squirrelling away ill-gotten gains in havens. The second is where it suspects offshore accounts are being used to evade tax on legitimately earned money.
The move by HMRC, which will have an impact on both the underworld and the criminal fringes of Scottish business, comes amid growing political intolerance of both illegal evasion and legal avoidance of tax using offshore tax havens.
In last month’s Budget, George Osborne announced plans to make it harder for British subsidiaries to transfer profit to parent companies in low-tax countries and “create losses” at home. The political crackdown on this kind of activity has made it easier to pursue illegal evaders too.
The UK, for example, has put in place “disclosure” agreements with Liechtenstein and Switzerland. This means anyone who has tried to dodge HMRC in these havens can now declare their cash and pay their tax.
This is a purely civil procedure, and can be carried out without the tax evader being publicly named.
However, The Herald understands that some of the criminal investigations relate to those who have failed to make full disclosures under the scheme. Other cases do not, however; those individuals or organisations under the spotlight having declared no offshore interests.
This raises the prospect of offshore tax evaders being named in Scottish courts in criminal actions.
Germany has already gone down this road. It has prosecuted a series of high-profile business figures since its intelligence service, BND, bought a CD full of the Liechtenstein bank details of 4500 citizens six years ago.
German prosecutors last month secured the conviction for tax evasion of Uli Hoeness, the former president of Bayern Munich, after he admitted holding cash in a Swiss account.
Law enforcement sources increasingly see the HMRC, whose Scottish criminal investigators now share a base with police and prosecutors at the Scottish Crime Campus in Gartcosh, as a key ally in their war on organised crime.
HMRC officials remain reticent about the move. Its Scottish assistant director for criminal investigations, David Odd, said: “I can say we are investigating some cases.
“Criminal investigation will look to investigate and report for prosecution any suitable case where we suspect that offshore funds are the proceeds of crime or, alternatively, are a criminal act being carried out in themselves.”
