SDLTM86600 - Compliance: Penalties

Contract settlements and abatement: Factors

The maximum penalty payable can be reduced or abated by up to

• 20 per cent (exceptionally 30 per cent) for the amount of disclosure by the purchaser. See SDLTM86610
• 40 per cent for the amount of co-operation received from the purchaser during the enquiry See SDLTM86630
• 40 per cent for the seriousness of the offences. See SDLTM86640

So, exceptionally, a compliance caseworker may start with a 100 per cent penalty, give abatements of 100 per cent, and leave no penalty payable.

The compliance caseworker should always be prepared to explain how they arrived at what is regarded to be the appropriate percentage penalty abatement by reference to these three factors.

The purpose of these abatements is to encourage and reward the purchaser who freely discloses information and co-operates fully. They also help ensure that minor offences only suffer minor penalties.

In other words, a compliance caseworker should treat

• more leniently the purchaser who

• less leniently the purchaser who

The three abatement factors mentioned may be linked, for example

• a purchaser may fear to disclose or co-operate in the establishment of an offence because of its seriousness
• a disclosure may have been found to be incomplete, co-operation otherwise having been good

Any such links should be ignored. The deduction under each heading should be the result of a separate and realistic appraisal of that particular abatement factor alone.

Thus, a purchaser whose offences are of the most serious kind likely to be dealt with locally would, with a full and spontaneous disclosure followed by maximum co-operation, qualify for the full deduction for disclosure and co-operation.

Another purchaser whose offences are less serious would in the absence of co-operation and disclosure end up with a larger percentage loading.