Corporate Criminal Offence Policy


The Criminal Finance Act 2017 is legislation enacted to prevent the facilitation of tax evasion within the UK and outside the UK by businesses with a UK connection and this policy aims to ensure Hemingways continues to meet the compliance obligations of the Act.
The legislation stipulates that all business must assess the risks of any tax evasion facilitation and implement improved controls where necessary to prevent stakeholders carrying out such criminal acts. The business would be criminally liable for not preventing associated persons carrying out tax evasion in the course of business dealings with us. Associated persons include but are not limited to suppliers, customers, employees and third party agents and representatives who act on behalf of the company with external parties.
Employees with roles that directly involve any eventual financial transaction (eg bank payments, placing procurement orders, sales) will be required to read this policy and there is also an e-learning training module to complete. External stakeholders will be required to comply with this policy also.
This policy is an important element in complying with the legislation and ensuring we continue to run the business with upmost integrity and in an ethical manner.


1.1 Tax evasion is the illegal non-payment or under-payment of taxes. It is usually perpetrated by falsely declaring or not declaring taxes due to the relevant tax authority. Tax evasion is a criminal offence. It can be committed by an individual (eg in relation to income tax or VAT) or a legal entity (eg in relation to corporation tax, VAT etc).
1.2 Example of circumstances in which tax evasion may arise include:
1.2.1 A corporate customer asking to pay in cash or offering inducements to invoice a different value than what is actually ordered;
1.2.2 a supplier asks us to pay them cash in hand or via some complex payment mechanism (eg paying to an offshore bank account) that allows them to evade tax;
1.2.3 A third party agent or contractor requesting an unusual method of payment (eg in gift cards) that breaches applicable local legislation (eg IR35)
1.3 The Criminal Finances Act 2017 (CFA 2017) is in force in the UK from 30 September 2017. It introduces a corporate offence of failure to prevent the criminal facilitation of tax evasion.
1.4 The offence has three elements, all of which must exist for criminal liability to arise:
1.4.1 criminal tax evasion by a taxpayer, eg by a customer, consultant or supplier of Hemingways;
1.4.2 criminal facilitation of that tax evasion by a Hemingway’s employee, agent or any other person performing services for or on our behalf; and
1.4.3 failure by Hemingways to prevent our employees, agents or other person performing services on our behalf from committing the criminal facilitation.
1.5 This corporate offence can be committed regardless of whether the tax evaded is owed in the UK or in a foreign country and can occur in both the public and private sectors.
1.6 There is only one relevant defence to the corporate offence of failure to prevent the criminal facilitation of tax evasion: when the tax evasion facilitation offence was committed, Hemingways had reasonable prevention procedures in place. This policy is a central plank of those prevention procedures. [/vc_column_text]


2.1 Involvement in the criminal facilitation of tax evasion exposes Hemingways and the person facilitating the evasion to a criminal offence. It will also damage our reputation and the confidence of our clients, suppliers and business partners.
2.2 Our position is clear: we conduct our business to the highest legal and ethical standards. We will not be party to tax evasion or the facilitation of tax evasion any form. Such acts would damage our reputation and expose us, our staff and representatives, to the risk of fines and imprisonment.
2.3 We take a zero-tolerance approach to tax evasion facilitation by our people and our third party representatives. We are committed to:
2.3.1 rejecting the facilitation of tax evasion; and
2.3.2 not recommending the services of others who do not appear to have reasonable prevention procedures in place.
2.4 Tax evasion may be more widespread in some countries and business sectors than others. In some cases you may be told that unless we facilitate tax evasion we will not win business. If we were to be involved in even one instance of tax evasion facilitation, we would have shown that we engage in such conduct and we do not engage in such acts.
2.5 This ethical stance is good for our business and is non-negotiable.
2.6 The following table sets out some of the benefits of acting with integrity and some of the possible consequences of not acting with integrity:
Benefits of acting with integrity Consequences of not acting with integrity
Increased chances of being selected as a supplier in public and private sectors
Other businesses will want to work with us
Remain in good standing with our banks and own suppliers
People will be more likely to want to work for us
Protected reputation A business that facilitates the evasion of tax is not in control of its dealings and is at risk of blackmail
If the business is found guilty of tax evasion facilitation or if it fails to put in place adequate procedures to prevent it, it could be subject to large fines
An allegation of tax evasion facilitation would result in severe reputational damage
Banking or supply facilities might be withdrawn or offered only on less favourable terms
Being blacklisted for tendering for private and public sector contracts
Hiring people would be very difficult


3.1 The act states that tax evasion may be facilitated by:
3.1.1 staff (employees, directors etc) or anyone they authorise to do things on our behalf;
3.1.2 agents, intermediaries, representatives and any other person who performs services for Hemingways or on our behalf.
3.2 These are known as ‘associated persons’ and for criminal facilitation to occur, the associated person would:
3.2.1 deliberately and dishonestly take action to facilitate the taxpayer-level evasion;
3.2.2 do so in their capacity as an associated person of Hemingways.

Common indicators of tax evasion facilitation (ie red flags) include those listed below. There may well be others:
4.1 request for payment by cash;
4.2 overly-complex payment mechanisms;
4.3 services/goods provided to jurisdictions that have a low OECD tax transparency rating;
4.4 transactions involving overly complex supply chains;
4.5 transactions involving offshore private banking facilities; and/or
4.6 records are incomplete or missing.


5.1 We aim to ensure our tax evasion facilitation procedures are proportionate to the risks we face.
5.2 We have performed an assessment of the risk of our organisation being exposed to tax evasion facilitation. This Tax evasion facilitation prevention policy has been developed in response to the results of that risk assessment. Where necessary, we will review our risk assessment and make appropriate changes to this policy.
5.3 Certain aspects of our business could present a higher risk than others of involvement in tax evasion facilitation but would be similar to what many other businesses also have to consider. These include:
5.3.1 Sales of high value and volumes of gift cards to customers who offer to pay in cash (not accepted in Hemingways) would raise a red flag or offer inducements to staff to facilitate orders and payments outside of the normal course of business;
5.3.2 Suppliers asking for invoices to be paid by cash or paid to offshore non UK bank accounts if the relationship is with a UK incorporated business;
5.3.3 Third party agents, representatives or consultants acting on Hemingways behalf with external parties that could be offered inducements or request to be paid in cash and not be invoiced;
5.3.4 Employees being offered tempting inducements to facilitate tax exasion (eg Staff with procurement responsibilities, finance dept etc);


It is essential that we keep full and accurate records of all our financial dealings—transparency is vital. False or misleading records are very damaging to a business. Always request that invoices (where expected and practical) are exchanged in all transactions and that checks on relevant suppliers and customers are carried out (eg on new corporate customers as required under the credit control policy) and filed.


7.1 The Finance Director has overall responsibility for this policy. They are responsible for ensuring this policy is adhered to by all staff.
7.2 Risk within the business will vary by area/location. The Head of each department is responsible for assessing the level of risk in their dept and with the approval of Finance and Managing Director, putting in place any necessary additional measures.


8.1 Every person who has a direct or some indirect impact of financial transactions is responsible for:
8.1.1 reading and being aware of the contents of this policy;
8.1.2 complying with this policy and any related policies, and
8.1.3 reporting cases where you know, or have a reasonable suspicion, that tax evasion facilitation has occurred or is likely to occur.
8.2 We will not penalise anyone who loses business as a result of not facilitating the evasion of tax.


9.1 Each of us has a responsibility to speak out if we discover anything corrupt or otherwise improper occurring in relation to our business. We cannot maintain our integrity unless we do this.
9.2 If you discover or suspect that tax evasion has been facilitated or may be facilitated, whether by:
9.2.1 a third party who represents us;
9.2.2 one of our suppliers or competitors;
9.2.3 a staff member; or
9.2.4 anyone else—perhaps even a client
you must inform a director and the HR Manager.
9.3 You can do this anonymously.
9.4 You must make your report as soon as reasonably practicable. You may be required to explain any delays.


All relevant staff will receive information, guidance and where relevant training to rectify any gaps in our processes that may cause a breach in the policy. Further guidance will be provided at least every two years or whenever there is a substantial change in the law or our policy and procedure.


11.1 Everyone must observe this policy.
11.2 The Finance Director has overall responsibility for this policy. They will monitor it regularly to make sure it is being adhered to. In doing so, they act in the interest of our business as a whole and it is therefore the responsibility of all of us to support it. The Board will be kept abreast on compliance with this policy.


11.1 Everyone must observe this policy.
12.1 Failure to comply with this policy could result in a criminal offence and carries potential severe penalties.
12.2 Because of the importance of this policy, failure to comply with any requirement of it may lead to disciplinary action under our procedures and this action may result in dismissal for gross misconduct. Any non-employee who breaches this policy is liable to have their contract terminated with immediate effect and supported by evidence, reported to the relevant authorities or upper hierarchy in their organisation.
12.3 If you have any questions or concerns about anything in this policy, please do not hesitate to contact the Finance Director.


11.1 Everyone must observe this policy.

Colm Phelan (FD) Andrews Johnson (MD)