How to Detect and Deter Financial Crime in Your Business

As part of being a business, you must abide by the UK government's business laws that have been put in place, one of these laws will fall under financial crime. To ensure you are complying with this, you will need to have a system of controls to show the government you 'aren't going to be committing any financial crime and that you are monitoring your business to make sure none takes place.

What is Financial Crime? What to look out for


There are some red flags you need to look out for regarding financial crime. You will need to look for the signs, stop it from happening and gather evidence on the whole situation. You will need this evidence to confront the perpetrators of this crime and bring it to court if required.

The main types of financial crime and what to look out for:

●     Money Laundering

Money Laundering is where a company disposes or cleans the money made through crime by running it through the company. They do this by inflating the money through the turnover. Cash transaction businesses are usually the type of companies that money laundering will go through. One way to spot it within your company is to keep an eye out for transactions that don't seem to make sense, such as when an asset is sold for less than its market value.

●     Corporate Fraud

Payment fraud, invoice fraud and trading fraud are all examples of corporate fraud. Often the perpetrators of corporate fraud are senior members of staff. For example, luring investors in by overstating profits or concealing debts from banks and investors are ways the fraud is committed. One large sign to look out for is if your company successfully stands out from your competitors when it is not apparent why that would happen with your business model.

●     Tax Evasion

VAT, PAYE, and corporate tax are the three taxes businesses are most likely to avoid paying. VAT carousel fraud, also known as missing trader fraud, is a type of fraud in which items are imported devoid of VAT and then sold to several enterprises, each of which pays VAT and then reclaims it from the government. You will need to look into how much tax should have been paid within your company and compare it to the actual tax paid.

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What Laws Should you be aware of?

fiancial law


The primary way to ensure all the above are being dealt with correctly is by first knowing the law. This is critical to understand when running a business, not just financial law but all the laws your company needs to follow to run a legal business. Below is a list of acts you must follow and should do your research on to make sure you are:

●     Crime Act 2002

●     Terrorism Act 2000 (other counter-terrorism acts)

●     Bribery Act 2010

●     Criminal Finances Act 2017

●     Money Laundering, Terrorist Finance and Transfer of Funds Regulations 2017

●     Fraud Act 2006

●     Theft Act 1968

All mentioned above must follow the MLRs' policies and procedures.  Register with the appropriate supervisory authorities. So, be aware of the current laws, industry and regulatory guidance.

How can you Prevent Potential Financial Crimes within your Company?



There are a few measures and things you can do to help prevent any financial crime:

●     Employ experienced employees who have the skills to do their job effectively.

●     Identify and understand the relationship with your customers

●     Research and understand financial crime risks

●     Apply the measures and controls once you understand financial crime risks

●     Monitor the way customers use your service

●     Have easy to understand policies in place for your staff

●     Review your staff regularly on their competence in their role

●     Make sure your senior management understands and comply as well

●     Double-check your third party contracts and agreements

●     Keep up to date with any changes within the law

●     Learn from any mistakes that may occur

●     If you notice something happening, put a stop to it before it gets worse

What is Financial Conduct Authority (FCA)

financial authority


The financial conduct authority is the governing body you will need to show that you are following the rules and putting safeguards to prevent any financial crime from happening within your company. You will have to prove to them you have put effective risk procedures and internal control measures to stop any financial risk from taking place. You, as the owner of the company, will need to figure out the best way to put these measures into place and make sure they fit in with the way your firm operates.

Getting a Financial Crime Lawyer


Financial crime within your company can be challenging to detect and can be easily hidden, so having knowledgeable eyes on your side will only assist you in stopping it. Hiring a financial crime lawyer can guide you in locating and enforcing any economic laws that have been broken. Is it best to call one in as soon as you notice the signs so you can stop it before someone is arrested and prosecuted? Finding a lawyer who can assist you with this can be difficult and time-consuming. Mishoura can save you time and effort by matching you with the right lawyer within 90 minutes of your consultation, making the process simple and allowing you to get back to running your business.

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