ARTICLE REVIEW - THE TRIADIC DILEMMA: WHY CORPORATE TAX CRIME AND CORRUPTION REMAIN SO HARD TO TACKLE

In this timely article, Alison Lui and Umut Turksen challenge the conventional separation of tax evasion and bribery, arguing instead that these offences are “intertwined and reinforcing.” This review explores the authors’ central thesis: that the UK’s sophisticated legal framework is undermined by a “triadic dilemma” involving definitional ambiguity, criminalisation challenges, and problematic corporate liability models. They argue these structural factors help explain persistent limits in corporate and senior executive accountability.

The article illustrates how corporate tax crime and corruption are often treated as separate worlds; one about dodging tax, the other about bribery and abuse of power. In that regard, the authors argue that the two forms of misconduct can reinforce each other and remain difficult to prosecute, given concealment techniques and evidentiary barriers. The study highlights that the UK, despite having a sophisticated legal framework, still struggles to hold corporations and senior executives meaningfully accountable, and attributes the enforcement gap to three recurring problems, presented as a triadic dilemma. Lui and Turksen’s analysis aligns with earlier scholarship suggesting that corruption and tax crimes face shared systemic problems of definition and enforceability (Ring & Grasso, 2023, Beyond Bribery). Taken together, the two works suggest mounting and recurring concerns that doctrinal labels and formal boundaries often lag how misconduct is organized in practice, with ambiguity and evidentiary friction shaping what gets investigated, charged, and ultimately sanctioned.

1. The Ambiguity Problem: What Counts as a Tax Crime?

The authors emphasize a fundamental structural weakness: the UK lacks a single, codified definition of “tax crime.” Their analysis argues that fragmentation enables multinationals to exploit the porous boundary between avoidance and evasion, including through profit shifting and opaque offshore structures. They discuss how complex corporate structures and cross-border strategies can amplify enforcement difficulty. Corruption and tax crime also blur together. Lui and Turksen suggest false invoicing, compromised officials, and manipulated records can operate as shared concealment methods across both categories. Moreover, such a fragmentation creates confusion for policymakers, prosecutors, and researchers alike. As the authors argue, this inconsistency is exacerbated by the diverse manifestations of the crime. They distinguish between collusive corruption, where both the briber and bribee derive mutual benefit through covert transactions, and extortive corruption, where a power asymmetry compels a party to offer bribes in response to coercive demands. They note that detecting collusive corruption is a “formidable challenge” because its consensual nature ensures both parties remain silent, whereas extortive corruption often emerges more visibly at bureaucratic “choke points” like tax assessments.

2. The Criminalisation Problem: A Wide Legal Net, Narrow Enforcement

On paper, the UK has strong tools to criminalise tax offences. Common law offences like conspiracy to defraud and statutory offences under the Taxes Management Act and VAT Act, give prosecutors a broad scope. Strict liability offences even remove the need to prove intent. But in practice, enforcement is weak. Out of 76,000 suspected tax fraud reports in 2022–23, only 540 individuals were charged. The authors interpret HMRC’s use of civil recovery as consistent with a revenue-recovery orientation, citing efficiency and litigation risk as implied drivers.

To modernize this approach, the Economic Crime and Corporate Transparency Act (ECCTA) 2023 now employs an expansive model that enables a “holistic assessment“ of corporate culpability, regardless of formal employment status. Under ECCTA s.196, senior managers are liable for specific economic crimes, such as fraud, when acting within their apparent authority. This landscape is shifting further with the proposed Crime and Policing Bill, which, if passed, would extend senior manager liability to all economic crimes. This evolution aims to move away from merely punishing individuals toward institutionalizing due diligence. The authors observe that while these legislative shifts aim to institutionalize due diligence, enforcement has become heavily intertwined with Deferred Prosecution Agreements (DPAs). These allow companies to avoid conviction in exchange for cooperation, but the authors raise a critical concern: this may inadvertently foster a “two-tier“ justice system. The article invites a deeper look into how large firms negotiate their way out of criminal liability, potentially eroding the punitive credibility of the law.

3. The Corporate Liability Problem: Fragmented Laws, Limited Accountability

The UK’s corporate criminal liability regime is inconsistent across tax and corruption offences. Similar misconduct, like false invoicing, may fall under entirely different statutes with different thresholds and defences. The Bribery Act’s section 7 offence is broad and powerful, while the Criminal Finances Act’s tax evasion provisions are narrower and harder to apply.

The case of SFO v Güralp Systems Ltd (GSL) exemplifies a “striking asymmetry“ in enforcement. While the “demand side“ (i.e., a foreign public official) was successfully convicted, the “supply side“ (the UK executives) largely escaped penal accountability. Despite email evidence confirming unlawful conduct and the company's own admission that it paid approximately $1 million in bribes, the senior executives were acquitted by a jury. This outcome exposes what the Lui and Turksen term a “central paradox” in corporate criminal law: group culpability without corresponding individual liability. This section foregrounds the authors’ concern that organizational resolutions can coexist with limited individual accountability, as it details how institutional reform can be praised while personal liability is diluted or lost entirely, creating an “accountability vacuum” that undermines public confidence.

4. Where Do We Go From Here? The authors argue for a more integrated approach, suggesting that treating egregious tax evasion as a form of corruption could sharpen enforcement tools and reinforce social condemnation. They advocate for improved data classification and a rigorous reassessment of the “failure-to-prevent“ model. Ultimately, the study provides a rich context that challenges existing discourse for those seeking to understand the future of UK economic crime enforcement. The authors predict that, without clearer definitions, stronger enforcement, and more consistent corporate liability rules, definitional uncertainty, constrained enforcement, and uneven liability rules will continue to limit outcomes absent reform. Readers seeking the authors’ full doctrinal account and policy proposals may consult the complete article, which provides a rich, multi-layered context that challenges existing scholarly discourse and offers a roadmap for more consistent corporate liability.

For the full, detailed analysis of the triadic dilemma and its legal implications, we highly recommend reading the original study:

Lui, A. and Turksen, U. (2026). “The triadic dilemma in the criminalisation and prosecution of corporate tax fraud and corruption in the United Kingdom.” Criminal Law Review, Issue 2, 82-103.

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