Birmingham accountant jailed in £1m tax fraud

An accountant from Birmingham has been jailed for defrauding the British taxpayer of more than £1m in unpaid VAT.

Muhammad Butt, proprietor of accountancy firm ABMG Business Services, was asked by HMRC to provide documents he held for two businesses that were under investigation. But despite receiving a court order in March 2010 he refused to hand over the paperwork, HMRC said.

The businesses, Chand Bridal by Khushboo and Kushboo by Chand, were owned by well-known Birmingham fashion designer and trader Amer Raza Ahmed who originally failed to tell HMRC about them. Ahmed eventually declared...

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davidwinch's picture

Further details

davidwinch | | Permalink

Mr Butt was sentenced to 3 years' imprisonment having been convicted after a jury trial of three counts of 'cheat'.  The offences reportedly related to the tax and VAT affairs of the clients and involved £685,000 direct taxes and £288,000 VAT over a period between 2003 and 2009.  A further £228,000 arose in interest on the undeclared taxes.

The implication, as far as Mr Butt is concerned, is not simply that he submitted returns for his client which have turned out to be incorrect - but rather that he dishonestly submitted returns which he knew to be false.

Mr Butt now faces ICAEW disciplinary proceedings which are likely to result in his exclusion.

David

Birmingham accountant jailed in £1m tax fraud

ver1tate | | Permalink

Let us hope for the sake of honest accountants that this case is well publicised in the newspapers making it clear that this is a (fairly) rare instance, and giving full derails of the extent of the disciplinary measures taken by the ICAEW, which should certainly be more than his mere exclusion.

davidwinch's picture

A rarity - but not as rare as you might think!

davidwinch | | Permalink

Another one bites the dust!

Chartered Accountant jailed for 18 months

David

E F's picture

The moral is    1 thanks

E F | | Permalink

The moral is that whilst qualifications are a guarantee (hopefully) of competence, they are no guarantee of honesty.

John Stokdyk's picture

Clarification from ICAEW

John Stokdyk | | Permalink

We have heard from the ICAEW that Mr Butt is not a member. The article has been charged to reflect this and we will check with other chartered bodies to see if any further discipline is likely to happen.

Please accept our apologies for any confusion caused.

Happy Up North Accountant's picture

Rare?

Happy Up North ... | | Permalink

I swear, every other week I come on to this site I read another story of an accountant involved in fraud. Obviously it's all relative but I very much have the impression in my mind that we're all as bent as a <insert old slang term for paper money here>. Trust me, I'm an accountant!

What?    1 thanks

Trevor Scott | | Permalink

E F wrote:

The moral is that whilst qualifications are a guarantee (hopefully) of competence, they are no guarantee of honesty.

A qualification cannot GUARANTEE anything other than, assuming the assessing body is competent, that at the time of the examination a person met a certain criteria; whether it be ....say getting 50% correct or 90% correct.  

 

Someone has got to take the blame for financial disaster...

Trevor Scott | | Permalink

Happy Up North Accountant wrote:

I swear, every other week I come on to this site I read another story of an accountant involved in fraud. Obviously it's all relative but I very much have the impression in my mind that we're all as bent as a <insert old slang term for paper money here>. Trust me, I'm an accountant!

Shame that the various accountancy and tax bodies haven't woken up (or do they just lack the leadership) to that fact, or taken advantage of the financial crisis with politicians looking for someone else to blame, to drive for a merger with legal recognition along the lines of the legal profession.

E F's picture

Sorry I disagree

E F | | Permalink

Trevor Scott wrote:

Shame that the various accountancy and tax bodies haven't woken up (or do they just lack the leadership) to that fact, or taken advantage of the financial crisis with politicians looking for someone else to blame, to drive for a merger with legal recognition along the lines of the legal profession.

 

I don’t see how that would make the slightest difference.

There are plenty of crooks in every profession, doctors not declaring private fee income, solicitors stealing from clients, etcetera.

What you are talking about is –

  1. Never going to happen
  2. Not going to make the slightest difference to the problem.

The simple fact is that where people have easy access to money (opportunity), then there will always be some who are weak, or desperate enough, to succumb to temptation.

 

Fred Goodwin is a Chartered Accountant!

Trevor Scott | | Permalink

And was a Chartered Accountant when at the head of RBS. He wasn't weak or desperate. He is supposedly regulated and, don't laugh, even holds an Insolvency permit from ICAS. 

Improving standard of training, CPD  including regular retesting, would go a long way together with true integrity and character of the individual.

I agree, sadly, that it is unlikely to happen.