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HMRC claws back VAT fraudster's criminal profits

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25th Apr 2017
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A gang of 11 men attempted to steal over £4m through a VAT fraud between 2009 and 2011, before the key figures were arrested and convicted.

A convicted fraudster who lied about being an accountant has been ordered to repay more than £2.2m to HMRC within the next three months, or face a further seven and a half years in jail, on top of his original sentence of five years for his role in a complex VAT fraud.

Salim Sakaria of Preston, who previously worked at Forte Accountants in the city, orchestrated the scam between 2009 and 2011. 

The gang led by Sakaria set up 19 fake construction companies in order to claim illegal VAT refunds. The fraudsters went to great lengths to cover their tracks, using puppet directors, fake invoices and fraudulent building contracts to build a veneer of legitimacy.  In reality, most of the companies didn't carry out any building work at all during the period of the fraud.

These companies were repaid over £2.9m for the fake claims, but suspicions were raised following an HMRC check on building companies in the North-West. Many of these 19 companies were found to be providing services to each other and using the same invoices and accountants. The coincidence raised suspicions at HMRC.

The authorities started gathering evidence, and investigators zeroed in on suspicious trading by several companies that underpinned fraudulent VAT repayment claims. After an extended period of surveillance, gang members were arrested, charged with fraud and eventually convicted, with some receiving long jail terms.

The tax department also issued an order to restrain Sakharia's assets while the case proceeded and following his conviction, he was ordered to repay £2,276,149 or face additional time in jail.

HMRC found that as well as owning six properties in the Preston area, Sakharia is also said to have around £2m in cash, some of which has been transferred to Dubai, which would theoretically give him the means to make the payment within the stipulated period.  

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By alan.falcondale
26th Apr 2017 12:00

2.2M for 7.5yrs
Not a bad trade = 293k/year plus free bed and board

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