8
I
Taxing Crime
Data collected by or available to tax authorities generally are from a variety of sources, including: Tax registration information and filed tax returns Accounting books and records of businesses Periodic (quarterly, annual, transaction-based) returns from businesses Customs declarations Whistleblower complaints or tax evasion petitions Exchange of information with foreign governments Information supplied by other jurisdictions via automatic, spontaneous, or upon-request routes • Reports from commissions of inquiry and research reports
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Box 2.1 lists examples of information that may help investigators identify suspicious transactions and criminal activity.
BOX 2.1
Legal, Financial, and Other Relevant Information Often Uncovered by Tax Authorities
The following information may emerge from tax authorities: • Beneficial ownership, which could determine the connection between a natural person and an asset, financial account/transaction, legal person, or legal arrangement • Assets disproportionate to declared or known sources of income • Accretion of wealth by politically exposed persons or close relatives (for example, acquisition of high-value real property) • Receipt of abnormal or sudden profits from commodity and stock markets, substantial exempt incomes (such as agricultural income), or other unidentifiable sources of income • Receipt of abnormal or frequent gifts from unrelated persons • Spending beyond one’s declared income and assets • Family members or associates of politically exposed persons controlling shell companies, trusts, or holdings that, in turn, hold valuable assets • Instances of nondeclaration of a conflict of interest discovered in tax audits • Fictitious, overpriced, or underpriced invoices uncovered in tax audits that may be used to disguise illicit payments, notably to businesses controlled by corrupt public officials or their associates or family members • Unusual monetary deposits from foreign banks that may not be captured by antimoney laundering reporting requirements for transactions conducted through offsystem channels
