Penalties and sanctions: trading without approval - deliberate but not concealed
Trading without approval is deliberate but not concealed if the person
- knows that they are required to be approved
- fails to seek approval at the correct time, but
- does not take active steps to conceal his deliberate failure.
This includes cases where a person has deliberately failed to keep any records of sales as opposed to actively concealing or destroying records.
You may initially consider a first contravention is non-deliberate. You should though consider on the balance of probabilities whether the behaviour is deliberate or deliberate and concealed. For example, if a business is told on a visit that they need to apply for approval, fails to apply immediately and makes a sale before finally submitting their application - the expectation is that this contravention is deliberate.
Example of Deliberate but not Concealed
Michael takes over an existing cash and carry business. He knows he needs to be approved but the business is doing well and he does not want to stop trading whilst he waits for a decision. He makes no attempt to hide his wholesale sales and there are no issues with his record-keeping or the legitimacy of his stock. He finally applies for approval when he gets round to it three months after he took over the business.
Michael has deliberately traded without approval to maximise his cash flow but has not concealed his activities.
Reasonable excuse is not available for deliberate but not concealed behaviour.