Three men found guilty of committing £38m VAT fraud through a ‘missing trader’ scam HMRC has branded the first case of its kind, have been jailed for a total of 35 years.
The VAT fraud trio used fake companies to trade carbon credits, on which they stole the VAT payments; Carbon credits determine what level of carbon dioxide a business can emit.
Carbon credits were imported from outside the UK, free of VAT, which were then sold inclusive of VAT before the fraudulent company used to trade the carbon credits was collapsed; turning the fake company into a ‘missing trader’.VAT Fraud trio stole £38m from the public purse
In an attempt to make the carbon credit trades appear legal, credits imported by the VAT fraud trio were sold on to three of their own ‘buffer’ companies first before their final sale to legitimate companies.
No payments of VAT were declared to HM Revenue and Customs (HMRC) during the duration of the carbon credit trio’s missing trader scam, which allowed them to defraud the public purse of £38m. The VAT fraud trio transferred the undeclared VAT charged by ‘missing trader’ companies to offshore bank accounts held in the United Arab Emirates; VAT Fraud proceeds were then divided between the three men.
Jailed for 35 years between them, the carbon credit trio were sentenced for their involvement in the VAT fraud as follow:
Sandeep Singh Dosanjh got 15 years imprisonment;
Navdeep Singh Gill received an 11 year sentencing;
Ranjot Singh Chahal was jailed for 9 years for his involvement in the VAT Fraud scam.
The £38m VAT fraud was carried out over a short period of six months in 2009; HMRC said that following the VAT investigation that the law has been changed to prevent carbon credit VAT Fraud. HMRC has also estimated that ‘missing trader’ scams cost the UK public purse nearly £1.5bn in the 2009-2010 tax year.
HMRC Criminal Investigations, Chris Martin, said: “This was a deliberate attempt to steal as much money as possible from the public purse by a criminal gang only interested in lining their own pockets. HMRC will not stand by and let crooks rip off honest taxpayers.”
Proceedings are already in place to recover the proceeds of crime from the carbon credit trios’ VAT fraud.
Kevin Kinsella Jnr Snr. | KinsellaTaxKevin Kinsella Jnr, of KinsellaTax, said:
“Lot of money, lot of time inside.”
VAT Investigations and allegations of VAT Fraud are serious and should not be ignored. If you have received a VAT enquiry from HMRC then you need to contact a tax professional for advice.
KinsellaTax staff consists of ex-HM Inspectors of Taxes and ex-HM Custom and Excise Officers fully trained in all typed of HMRC Investigations.