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HMRC internal manual

Fraud Civil Investigation Manual

Where CDF offer is made up to 29 June 2014: pre-authorisation review and action: suspicion of fraud

When a case is under review, it is not always possible to reach a conclusion on whether or not fraud has actually occurred; not all of the facts may be known. Though evidence held may suggest fraud, it will often be untested. As part of the review process, we should be looking for the strength of evidence to demonstrate our suspicion of fraud.

You should keep an open mind at all times. Your judgement should be directed to the question of whether or not there is a reasonable suspicion of fraud to justify recommending that the case be registered under COP9.

There can be enormous variation in the weight of actual or potential evidence suggesting that fraud has occurred. It is absolutely essential when Investigators are considering what suspicion of fraud exists that they exercise discretion.

This judgement can only be subjective (and often provisional). Some review cases will have been proceeding from the outset in the knowledge that fraud has occurred. Others will not. However in all cases it is necessary to consider when the review is concluding whether or not a reasonable suspicion of fraud exists.

Where the taxpayer or agent contacts HMRC requesting the offer of a CDF, as they have a tax fraud to disclose we will probably have no facts to go on apart from the name and address of the taxpayer. We will however have the suspicion that the taxpayer has committed fraud otherwise CDF would not be appropriate (see FCIM102060).

All requests for a CDF must be handled responsibly. We will need to check with Criminal Investigation and the taxpayer’s records to make sure that there are no other interventions underway or pending. If after making these checks we are certain that there is no reason not to offer COP9/CDF then the decision to proceed is relatively simple.

The fact that there is an ongoing civil intervention or compliance check does not, in itself, mean that COP9/CDF can not be offered. However, you will need to liaise with the investigating officer to ensure that the handover is managed correctly. If there is an intervention pending you will need to ensure that this is stopped so that any notices etc are not issued to the taxpayer.

Following on from HMRC making the CDF offer, the way in which the case develops and is settled will depend on what is disclosed in the Outline Disclosure.