question on internal control and fraud notes

This topic has 3 replies, 2 voices, and was last updated 6 years ago by Ken Garrett.

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November 18, 2019 at 6:28 pm #553032
farhaanm
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How these: 1.Many jurisdiction involved in the transfer of money 2.The use of tax havens 3.Bearer bonds or cheques

Increase the risk of fraund?
November 19, 2019 at 9:33 am #553057
Ken Garrett
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1 If many countries are involved it means that the police (for example) have to understand and get the cooperation of many countries and foreign banks.

2 Tax havens tend to be secretive.

3 Bearer bonds and cheques are owned by the person who has them ie they are like cash. This means money can be transferred by simply giving people a document without any audit trail or evidence as to where the money came from/went to.
November 20, 2019 at 3:27 pm #553195
farhaanm
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Why tax havens are secretive? My understanding is that a company will only transfer a part of itself to a tax haven to avoid tax at high rate.
November 20, 2019 at 3:49 pm #553209
Ken Garrett
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If, say, you live in the UK and do not want to pay tax, then placing your money in a tax haven will often hide it from the UK tax authorities and other interested parties. Useful for money laundering where you do not want anyone to inquire about where it came from.
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