A ground-breaking alliance dedicated to tackling global financial crime must continue its efforts to defeat tax cheats and frauds Financial Secretary to the Treasury, Lucy Frazer QC told an enforcement summit this week.
The heads of tax enforcement from the UK, Australia, Canada, Netherlands and the US came together in London for the latest Joint Chiefs of Global Tax Enforcement (J5) summit to share intelligence and coordinate efforts on a global level against international tax crime and money laundering.
Financial Secretary to the Treasury, Lucy Frazer, told the summit:
Tax fraud is a perennial and persistent threat to all our nations. Unity, transparency and collaboration will be essential if we’re to tackle it.
Put simply, tax cheats flourish when we fail to work together. Every scrap of information left behind by fraudsters – in any one of our jurisdictions – is a potential lead in the fight against global tax crime.
By joining forces, we undermine the global criminal community in ways we could not do alone.
The London summit, hosted by HM Revenue and Customs (HMRC), marked four years since the J5 group was established and renewed commitments to build on recent operational successes to find innovative solutions to some of the most complicated tax crime matters facing all five countries, providing global leadership on collaboration between tax authorities.
The week-long summit began with the J5 Challenge, which brings together investigators, subject experts, data scientists and others to analyse a range of data and intelligence, including that from decentralised exchanges, to identify tax evasion.
The event also included the inaugural Global Financial Institution Summit (GFIS) – the start of ambitious talks between the J5 and some of the world’s biggest banks on what more can be done to tackle tax crime together.
This was followed by a public-private partnership event where leaders from both sectors came together to examine key threats to the international tax system.
The summit culminated in a Chief’s meeting where the partners discussed emerging threats and agreed new operational priorities and targets. It follows a string of recent successes for the J5, including 10 individuals charged, following a suspected multimillion-pound investment and impersonation scheme, aimed at defrauding people across the globe.
Simon York, Director, Fraud Investigation Service, HMRC said:
I am absolutely delighted have been asked to host this J5 International Tax Enforcement Summit, the first face-to-face meeting in over two years, and first meeting of our J5 Public Private Partnership.
This is a big moment for the J5 and a key step forward in realising our aim of becoming the international voice of tax enforcement.
We’ve done fantastically well to work virtually over the last two years but getting together has enabled us to significantly strengthen our relationships and plan the next phase of this ground-breaking alliance.
At the conclusion of the meeting, each Chief signed on to a Communique that reaffirmed their commitment to the organisation and summarised the progress made throughout the week.
Brett Martin, Assistant Commissioner, Australian Taxation Office (ATO) said:
This week has been highly productive and has highlighted the commitment working with a public-private partnership model. Working together to tackle professional enablers of tax evasion and crime, and associated money laundering, we aim to enhance our systems to better detect and disrupt criminal networks.
Information sharing across the J5, enhanced with stronger relationships with financial institutions places us at the forefront of disrupting criminal networks that target our public finances, especially when it comes to tackling professional enablers of crime.
Eric Ferron, Director General, Criminal Investigations, Canada Revenue Agency (CRA) said:
Our message is clear: Canada and our J5 partners will not tolerate cross border tax evasion. The work accomplished this week will go a long way towards expanding our reach of tax enforcement.
Niels Obbink, Chief and General Director, Fiscal Information and Investigation Service (FIOD) said:
Although investigating crimes associated with decentralized finance and NFTs may sound challenging, it is essential to acknowledge the importance of these innovations and to address this topic in the future, we have to, if we want to effectively combat these new forms of crime.
Jim Lee, Chief, IRS Criminal Investigation said:
It clearly feels like we have turned a corner with this gathering of the J5 in London this week. We have gone from an organization trying to find our footing and our voice to an organization that is poised to have some of the biggest enforcement announcements this year.
We are working with the biggest banks, establishing partnerships in public and private industries, and putting criminals in jail – it is no longer conceptual, it is reality.
The J5 works together to gather information, share intelligence and conduct coordinated operations against transnational financial crimes. The J5 includes the Australian Taxation Office, the Canadian Revenue Agency, the Dutch Fiscal Information and Investigation Service, HM Revenue and Customs from the UK and IRS Criminal Investigation from the U.S.
Tackling tax evasion is a crucial part of HMRC’s role in supporting and creating a level playing field for compliant businesses.
Where sanctions evasion is taking place, the National Crime Agency will investigate, and the government has recently announced the formation of a new dedicated ‘Combating Kleptocracy Cell’ to target sanctions evasion and corrupt elites’ assets hidden in the UK.
Through the Economic Crime (Transparency and Enforcement) Act, the government has taken far-reaching steps to improve corporate transparency, including introducing a Register of Overseas Entities to crack down on foreign criminals using UK property to launder money, reforming Unexplained Wealth Orders, and strengthening HM Treasury’s ability to take action against sanctions breaches.
For more information about the J5, please visit www.irs.gov/j5.
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