10. STUDY MANUAL questions on Criminal law. Flashcards
Financial Wizards LLP invites 20 senior partners in three local accountancy firms to an England v Wales rugby match, in the hope of securing new business.
Has an offence been commited under the Bribery Act (2010)?
No. Such normal corporate hosipitality is likely to be regarded as entirely proper.
Jack offers a HMRC inspector a sum of money to turn a blind eye to a minor irregularity in his financial records, but the inspector refuses to accept it.
Has an offence been committed under the Bribery Act (2010)?
Yes. The offering of a bribe is an offence, even if that offer is declined.
Angela is an auditor working at Frazzle Ltd. She believes that accounting irregularities point to the Managing Director being involved in criminality. She should …
Report the matter to her firm’s MLRO, and ONLY to that person.
A builder always requiring payment in cash should ALWAYS be reported to the NCA?
No. Only if, for example, it is not all being declared as income.
A client discloses over a business lunch that he is paying builders working on his home in cash, believing that the good price he has been offered is as a result of their not declaring the income.
Should this be disclosed to the MLRO/NCA?
Yes.
Which act governs the law on whistleblowing?
The Public Interest Disclosure Act (1998)
T/F: A person making a qualifying disclosure must be able to show, on the balance of probabilities, that the matters alleged are true.
FALSE
they need only show that they had a ‘reasonable belief’
The standard of proof required for a whistleblowing disclosure is that the worker had a ‘…’ of the alleged wrongdoing.
reasonable belief
T/F: A whistleblowing disclosure must always be made to a person’s employer in the first instance.
FALSE
In the event of a valid whistleblowing, the whistleblower (is / is not) entitled to claim damages.
is
Whistleblowing legislation is designed to …
protect the worker
T/F: Whistleblowing legislation exists to punish employers.
FALSE
It is to protect workers making qualifying disclosures.
The three principal ways of committing fraud under the Fraud Act (2006) are:
Fraud by false representation.
Fraud by failure to disclose information.
Fraud by abuse of position.
T/F: The criminal offence of fraudulent trading requires that the relevant company is insolvent or in liquidation.
FALSE
Fraudulent trading may be going on in a profitable, going concern.
The three principal offences under insider dealing legislation are:
Dealing.
Encouraging another to deal.
Improper disclosure of inside information.
T/F: an offence is commited under insider dealing legislation even if the reason for ‘encouraging another to deal’ is not disclosed.
TRUE
T/F: an offence is commited under insider dealing legislation even if the person who has been ‘encouraged to deal’ does not actually do so.
TRUE
The maximum penalty for insider dealing is … imprisonment.
7 years
Inside information is PSI* relating to a SI of securities that are PA and not to securites generally. It must, if MP, be likely to have a SE on P and it must be specific or P.
price sensitive information
Inside information is PSI relating to a SI* of securities that are PA and not to securites generally. It must, if MP, be likely to have a SE on P and it must be specific or P.
specific issuer
Inside information is PSI relating to a SI of securities that are PA* and not to securites generally. It must, if MP, be likely to have a SE on P and it must be specific or P.
price affected
Inside information is PSI relating to a SI of securities that are PA and not to securites generally. It must, if MP*, be likely to have a SE on P and it must be specific or P.
made public
Inside information is PSI relating to a SI of securities that are PA and not to securites generally. It must, if MP, be likely to have a SE* on P and it must be specific or P.
significant effect
Inside information is PSI relating to a SI of securities that are PA and not to securites generally. It must, if MP, be likely to have a SE on P* and it must be specific or P.
price
Inside information is PSI relating to a SI of securities that are PA and not to securites generally. It must, if MP, be likely to have a SE on P and it must be specific or P*.
precise
T/F: A person accepting a bribe is guilty of an offence under the Bribery Act (2010)
TRUE
Making or attempting to make the proceeds of crime appear respectable.
money laundering
Any activity by which the apparent source and ownership of money representing the proceeds of crime are changed so that the money appears to have been obtained legitimately.
money laundering
Three principal defences to a charge of failure to report money laundering DIRECTLY to the NCA by an accountant employed in a firm.
Insufficient training.
Specific privileged circumstances.
Report was made to the MLRO.
T/F: general legal privilege exists in respect of an accountant giving advice on revenue (tax) law.
FALSE
General legal privilege applies only to solicitors, barristers, e.t.c. and NOT to accountants.
The maximum penalty for …. is 7 years imprisonment.
insider dealing
The maximum penalty for money laundering is … imprisonment.
14 years
The maximum penalty for … is 14 years imprisonment.
money laundering
The maximum penalty for failure to report money laundering is … imprisonment.
5 years
The maximum penalty for … is 5 years imprisonment.
failure to report money laundering
The maximum penalty for tipping off is … imprisonment.
2 years
The maximum penalty for … is 2 years imprisonment.
tipping off
The maximum penalty for fraud or bribery is … imprisonment.
10 years
The maximum penalty for … is 10 years imprisonment.
fraud or bribery
