HM Revenue & Customs (HMRC) has announced that it is writing more than 600 former customers of the Euro Pacific Bank to make corrections to their tax affairs.
This comes after the Puerto Rican authorities suspended the bank’s licence based on their suspicions that it was being used to facilitate tax evasion and money laundering around the world.
At the end of June, Puerto Rico’s Office of the Commissioner of Financial Institutions (OCIF) sent the bank a cease-and-desist order.
This came after a two-year investigation backed by the Joint Chiefs of Global Tax Enforcement, which includes the tax authorities of the UK, US, Australia, Canada and Netherlands.
Known as J5, this group of authorities launched an investigation into Euro Pacific following its relocation from St Vincent and the Grenadines to Puerto Rico.
Investigators believe that this move was part of an attempt to remain out of the Common Reporting Standard (CRS).
HMRC’s Fraud Investigation Director, Simon York, said: “We suspected that clients were using a sophisticated system to conceal and transfer funds anonymously to evade tax and launder the proceeds.”
Australian authorities found that anonymous numbered accounts were being issued and learned that Puerto Rico was running a parallel investigation into the bank’s role as a suspected tax evasion and money laundering facilitator.
HMRC has already had a series of live tax enquiries, full criminal investigations and intel operations into the most serious frauds that were uncovered, but it is now pursuing other Euro Pacific customers in the UK whom they suspect may have tried to evade tax.
HMRC is now preparing criminal investigations and, in its letter, is calling on former customers of the bank to “do the right thing” and review their tax affairs and make any outstanding payments of tax. Disclosures can be made under the existing Worldwide Disclosure Facility.
If you are concerned about HMRC’s pursuit of taxpayers or you think you might be affected by this latest crackdown, please contact us.