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JailedVAT Fraud

£1.5m scrap metal fraudster jailed for five years

By December 12, 2014June 13th, 2017No Comments

A scrap metal fraudster from Staffordshire has been jailed for five years for a £1.5m VAT fraud scam…

Michael Bostock, 37, committed £1.5m VAT fraud by fraudulently buying and reselling scrap tin, nickel and copper through his company, International Electrical Distributors Ltd (IED Ltd), based in Staffordshire.

Bostock used money from the value-added-tax fraud scrap metal scam to upkeep a property in Penzance way, Stafford and a £1.4m cottage in Cheshire.

Lamborghini Gallardo

The dad of three also stocked up a lavish sports car collection including a Porsche, Aston Martin, Ferrari Spider, Lamborghini Gallardo, a Ferrari Scaglietti worth £185,500 and a £274,000 Mercedes McLaren.

Bostock also conned travel agents for £100,000 worth of luxury first-class holidays in Dubai and Indonesia, getting the trips on credit and failing to pay the bill.

Five British businessmen were also conned out of £200,000 by the VAT fraud scrap metal scammer after they were falsely promised unbelievably high returns for investing their money in the ‘bent’ business.

Also jailed for his part in the VAT fraud scrap metal scam was Michael Davies, 47, from Yarnfield, Stone.

A freelance metal trader, Davies was employed by Bostock as a ‘consultant’ and was sentenced to three years in prison for helping to set up fraudulent deals in the £1.5m VAT fraud scam.

Scrap Metal Trade

£1.5m was fraudulently pocketed as tax should be refunded on exported metal. To take advantage of this, false sales and purchase invoices were created that showed metal had been sold to a business in Cyprus through Belgium and Ireland, before IED Ltd bought back the metal; when, in fact, metal shipments never left the UK and were instead sent to another scrap yard in the country and were therefore liable for VAT.

After a 14 month criminal investigation there was a series of dawn raids by HMRC on IED Ltd in January 2008. The VAT Fraud scrap metal scam’s lengthy proceedings could not be reported on until Bostock, Davies and four other men involved either admitted to or were convicted of VAT fraud.

On sentencing at Warwick Crown Court, Judge Ian Tomlinson said:

“This was a professionally planned conspiracy. You were living beyond your means, living the high life at the expense of the taxpayer.”

Bostock is already serving an 18 month prison sentence for trying to hide £500,000 from HMRC Proceeds of Crime investigators and was arrested in October 2011 for pleading guilty to 77 Contempt of Court charges in relation to hidden money and assets.

Other men who were sentenced on Monday 7May for their involvement in the VAT Fraud scrap metal scam include Nicholas Richmond, 43, from Buckinghamshire, who got three years as director of Cypriot company Shavondra Ltd who drew up false paperwork to show the transportation of scrap metal from Cyprus to the UK; Mohammed Shabir Hussain, 41, from Newcastle under Lyme, who was sentenced to four years for preparing paperwork and creating blueprints for the VAT Fraud; Michael Bexon, 56, from Stoke on Trent, got a twelve month suspended prison sentence for falsifying paperwork to show that scrap metal had been exported through his freight forwarding company; and Jamiel Hussain, 35, Brother of Mohammed, received a nine month suspended prison sentence for invoicing falsified paperwork in IED Ltd’s offices.

HMRC inquiries are underway to recover money lost to the public purse, around £193,000 in cash has already been retrieved from the VAT fraud scrap metal scammers.