TPD17040 - Fraud and theft: Revenue offences associated with theft

Although the theft of tobacco products will often mean that some incidental revenue offences will have been committed, the prime motive of the thief will not necessarily have been to defraud the Crown of the duty. It follows that it will not always be appropriate to take proceedings for the revenue offences in parallel with police proceedings for the theft. Every case should be considered on its own merits. In deciding your action you should take the following factors into account.

• Whether it is petty theft or whether it could be of greater significance and requires further investigation (eg by the NIS), bearing in mind that major frauds can sometimes be uncovered by the investigation of what seem initially to be trivial irregularities.
• Whether the stolen products were taken before or after the stage where they should have been included in the production account.
• How it happened and whether the trader’s control arrangements could be improved to prevent a recurrence.
• Whether the evidence would support a revenue prosecution.
• Whether the publicity of a conviction for a revenue offence would aid control (traders often welcome a revenue prosecution because it reinforces their own disciplinary measures).

The Department’s attitude towards petty theft is that the trader is responsible for the safe custody of his goods and for the duty. He is therefore expected to deal with each case by disciplinary action, which often involves dismissal and prosecution for theft. If you are satisfied that the trader has taken action which will effectively deal with the case and deter other potential offenders, official action can be confined to recovery of the duty from the trader and/or issue of a warning letter if the trader has failed to properly secure and account for the products.

Petty theft, in this context, means isolated abstractions of a few retail packs of tobacco products for personal use. Systematic abstraction of products in larger quantity for gain or commercial resale should not be regarded as petty theft and more stringent action should be considered, especially if the thief has a supervisory or management role in the company or is in a position of responsibility (eg a security guard).

As a general rule, if theft charges are being brought by the police it will rarely be appropriate to take parallel proceedings for a revenue offence, if the quantities involved are 5,000 cigarettes or less (or the revenue equivalent in the case of other products).

In other cases, where significant sums of duty have been evaded, much will depend on the views of the prosecuting authority as to the desirability of associating revenue charges with those for the theft. It will usually be appropriate to consider charges for offences under the Customs and Excise Acts if the offence is committed by, or with the involvement of, the trader or its responsible employees.