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HMRC arrests couple for £6m furlough and tax fraud

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HMRC officers have arrested two people in West Yorkshire for a suspected £3.4m furlough fraud and multi-million-pound tax fraud.

7th May 2021
Staff Writer AccountingWEB
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A 35-year-old man and 36-year-old woman were arrested after HMRC’s Taxpayer Protection Taskforce officers executed a search warrant. The West Yorkshire pair were targeted following an HMRC investigation into a multi-million-pound fraud. 

Both were apprehended on suspicion of cheating the public revenue, VAT evasion and money laundering, HMRC announced today in a press release.

The pair face two separate charges – a suspected £3.4m Coronavirus Job Retention Scheme (CJRS) fraud, and a suspected multi-million-pound tax fraud.

Both have been released under investigation, but over £6m in funds controlled by the two has been frozen by HMRC.

“The Coronavirus Job Retention Scheme is part of the collective national effort to protect jobs,” said HMRC Taxpayer Protection Taskforce director Janet Alexnder. “The vast majority of employers will have used the CJRS responsibly, but we will not hesitate to act on reports of abuse of the scheme or any HMRC administered Covid-19 support packages.”

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Replies (4)

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By Hugo Fair
08th May 2021 12:35

Whilst it's understandable that HMRC are reticent in providing much detail of the suspected fraud, it would have been useful if there were at least some indicators (so that Agents and Employers get a clue as to what they should check they've not done)!
As it is, the article reads as though it's been dictated by HMRC's press dept ... designed to cause fear but without clarification.

The bulleted "four areas of protection against fraud" aren't even either comprehensive or entirely accurate:
* One of the (omitted) major areas is that the claimed amount MUST be paid in its entirety (now that there's no re-imbursement of ER's NICs or Pens contribs) to the furloughed employees - which is why they are now notifying individuals (via their PTA) that they've been claimed for. If this rule isn't met (even by a penny) then the whole claim is void and must be repaid.
* Similarly (in the days when there was some re-imbursement of ER's NICs or Pens contribs), the full amount due (of tax, nics, etc) to HMRC each month MUST have been paid by the employer on time - otherwise the claim becomes void.

And to say that "All claims are assessed by a specialist team within a 72-hour window" is at best highly misleading. All claims may be 'vetted' by various algorithms and a select few reviewed by humans (or passed to specialists outside the 72-hour window), but there were over 4 million employments for whom CJRS were still being claimed (by almost 760,000 employers) as at 31 Mar 2021 ... and there's no way that these were each individually assessed within 3 days of submission.
[see https://www.gov.uk/government/statistics/coronavirus-job-retention-schem... for more statistics if you want].

Don't get me wrong, I'm all for HMRC getting our money back from fraudsters ... but please don't fall for their PR guff.

Thanks (6)
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By Paul Crowley
09th May 2021 16:25

A clear and obvious risk is the claim for an employee that has left. Quite likely in hospitality.
We do not make the wages payments. Client does.

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By ds
10th May 2021 11:50

Probably the tip of a very large iceberg.

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By johnjenkins
10th May 2021 12:00

At last a scam that has been detected and dealt with. I bet it was an easy one to spot.

Thanks (1)