False Accounting

In some cases, false accounting is led by the business owner, who is under financial pressure to keep the business afloat. In other cases, some records or documents may have been altered to satisfy the requirements for a business loan or grant.

Covered by Section 17 of the Theft Act 1968, false accounting can be executed by either hiding the extraction of funds from a business or boosting the appearance of a company’s performance. Under the Theft Act 1968, this crime is defined as typically being executed by an individual intentionally falsifying, altering or submitting deceptive, false or inaccurate records for accounting purposes.

False accounting is an illegal practice that can be and often is hidden from business owners. Those involved can be organised by including a group of people who can play their role in every part of the process, making it very difficult to spot that something is going financially awry.

Examples of the way that false accounting or fake accounting can manifest include:

• Manipulation of accounts to evade tax liability
• Keeping two sets of account in case of HMRC audits or inspections
• Hiding losses to avoid financial help from being withdrawn
• Obtaining additional credit or finance to deal with cash flow issues
• Winning new customers by making a company appear more successful than it is

If you or somebody you know is facing charges or is part of an investigation into false accounting, then you’re likely to have some questions. We have written the following guide to help you answer those questions. If there is a question that you cannot find an answer to, contact us or call us on 0208 888 5225.

Are you facing false accounting proceedings? 

If you find yourself in a situation where you have to face allegations of this offence, you must engage an expert false accounting lawyer to help you. You will need guidance for every stage of the process so that you can continue to operate your business during the investigation phase.

Receiving allegations can make anybody feel under immense pressure. Any complaints must be faced head-on with a defence strategy that is robust and competent. Ideally, you’ll hire the services of a business fraud solicitor who not only has experience in this field but who has the talent, vigour and determination required to get your name cleared.

If you’re accused, you must have access to legal professionals who have the experience and knowledge needed for you to be successfully defended against such allegations. A favourable outcome must be secured so that you do not need to spend any time imprisoned, or you could lose your business and livelihood or put your dependents into a financially unstable situation.

Once you have professional accountants working on creating a defence for you, you will be far more at ease with the case. You’ll know that you’ve taken the best step in giving yourself a shield and will be able to put your attention to the operation of your business.

What happens next in false accounting proceedings?

Whether it’s been a case of hiding transactions or changing accounts so that liability of tax is evaded, any false accounting practices are taken very seriously by HMRC.

Over the last few years, cases of false accounting have increased. Companies who are struggling to stay afloat can sometimes believe that overstating their performance is the only way forward. They will list that they have more assets than they do and that their position is more established than it is in reality.

Although those who perpetrate this act are not necessarily benefiting from this act, the most common reason for doing it is to keep their business alive.

These fraudulent acts can be discovered during HMRC inspections or audits. In some cases, companies will also hold two sets of accounts to avoid tax liability.

Whether you’re a small business which has been involved in small scale false accounting, or somebody who is involved in this crime at a broader level, you’ll need the help of an experienced false accounting lawyer.  Ideally, it will be a legal professional with experience of working on complex cases.

The best accounting focused solicitors use several resources to craft a strong defence. These resources include:

• HMRC Representatives
• Forensic accounting experts
• Computer forensic experts
• Expert witnesses

Financial experts can examine any evidence presented by the prosecution for weaknesses that can be used in the defence strategy. In these types of cases, the prosecution may be the police, the serious fraud office or even the HMRC Tax Office.

What should you know about false accounting?

False accounting goes further than what is listed in ‘the books’ of a company. It can extend into the VAT or records of a business. Where there is any record required for accounts, there can be false accounting.

False accounting can also extend to documents that are required to be completed and submitted to secure a grant or a loan.

This is an offence that can even be executed when new customers are won based on the false representation of the company. Making the business look to be more successful than it is, is considered to be an offence under this category.

Obtaining the help of a false accounting legal expert early in the case can help to prevent misjudgements and errors from occurring. Avoiding these can help to protect the case from any prejudice so that the most favourable outcome can be gained.

What is the sentence for false accounting?

The sentence for false accounting ranges from six months to a maximum of seven years.

In 2013 there was a case of a headmaster leaving a fraudulent paper trail of payments and bonuses. In addition to being suspended from his role at the school, he was sentenced 12 months imprisonment, suspended for two years. In this case, the convicted headmaster received a delayed prison sentence. In those two years of suspension, he would have to comply with any other requirements required by the court, such as a prohibited activity requirement.

Read more about sentencing for False Accounting offences

Can you get a criminal record for false accounting?

If you are found guilty and convicted of false accounting, you will be handed a criminal record.

Stuart Miller Solicitors can help

Stuart Miller Solicitors have extensive experience of defending false accounting cases in addition to other business fraud cases such as VAT fraud and tax fraud.  Besides, we can liaise with any agencies who are part of the prosecuting team. These agencies may be:

• National Crime Agency (NCA)
• Financial Conduct Authority (FC_
• HM Revenue and Customer (HMRC)
• Office of Fair Trading (OFT)
• Serious Fraud Office (SFO)
• City of London Police
• Department of Trade and Industry (DTI)

If you’ve recently been informed that you’re part of a police or HMRC investigation into false accounting, you’ll likely find this very worrying. If you are convicted, you could be facing a 7-year prison sentence and potentially a Director Disqualification, depending on what your role in the offence has been.

No entrepreneur wants to be crippled so that they cannot use their talent and passion to make their living from their own business. Success remains forever out of reach also if you’re having your hands tied by an investigation into your accounting.

The first step in clearing up a matter of this nature is to work with solicitors so that an explanation can be created to provide an account that justifies why the accounting is as it is.

With over 30 years of experience in false accounting defence cases, Stuart Miller Solicitors can provide you with the legal advice required to navigate false accounting proceedings to a more favourable outcome successfully.  In addition to holding experience in defending low-value cases, we also have successfully defended high court costs (VHCC) cases which have included false accounting allegations.

No matter what size the case is, or what size the company involved is, our team have the knowledge and expertise to be able to defend vigorously. From small businesses to groups of companies, we can provide you with a defence and guidance on how to get the best possible result.

Stuart Miller Solicitors is the best choice for false accounting Cases

Stuart Miller Solicitors is recognised as being one of the largest and most competent false accounting defence firms in the country. Our clients tell us that they believe we are the best choice when it comes to the provision of both legal guidance and representation. The fraud solicitors in our team know the criminal justice system but have experience of White Collar Fraud work and serious fraud cases.

What makes us different is that we are commercially aware. No matter what your case is, we can work with you to form arguments that have a better chance of resulting in being favourable for you.

Our team are also known for our compassion and support. Of course, being told that you’re part of a tax audit or under investigation by the City of London Police is no walk in the park. The team understand how worrying this can be, especially if you believe you may have misunderstood some of the accounting rules.

Whatever your situation is, we are here to hold your hand through every step in the investigation and possible trial. We have a reputation for excellence.

What can we do to help?

Our lawyers have in-depth experience of false accounting investigations. Whether you’re being accused of false accounting by the State or other parties, we can help you from every angle, including giving you direction on what to say and what not to say.

How we will defend you

The critical point with any legal matter is to not only know the situation inside out but to be fully aware of how it may be possible to use the law to help you.

False accounting can be a severe investigation that could hurt your lifestyle and reputation. It can also impact family life, and it’s for this reason that we have a 24-hour help centre.

Book a free consultation with our false accounting lawyers

Early action must be taken in any legal case. By preparing a rapid response for HM Tax Office can sometimes be enough to get any case revoked.

We invite you to speak with our fraud lawyers, and if necessary an expert fraud barrister. You can contact us by completing our contact form, or you can call us on xxx

Alternatively, if you use WhatsApp on your mobile phone, there is a link at the bottom of this page to make contact with us.

Discuss your case before instructing us

If you’ve been arrested and need representation at the police station, we can help you. Call our emergency number listed above for immediate assistance.

Our legal team can work on securing your legal aid so that you can have your defence strategy funded by the State. If you’ve found yourself with a restraint order applied to your assets, we can help you with getting them varied or removed.

If for some reason you don’t qualify for legal aid, Stuart Miller Solicitors offer fee levels that are very competitive and we give advance notice of costs when possible.

Get in touch today for either a face to face meeting, a phone call or a video call.