HMRC has published its most successful tax fraud prosecutions for 2019. During the year 600 people were convicted and around £5bn was recovered through civil and criminal investigations.

The top prosecutions for 2019 are:

  1. Bogus HIV research and cure companies together with their directors and a leading scientist falsified scientific claims in order to persuade investors to subscribe for what they thought were tax qualifying investments. Two men were jailed for a total of 14 and a half years for the £60m tax fraud and for cheating the investors. There was no evidence that the £160 million invested was spent on qualifying expenditure by the company and HMRC disallowed claims for investor tax relief.
  2. Nine Berkshire-based fraudsters were jailed for over 46 years. The gang orchestrated a missing trader VAT fraud of £34m. They then laundered the tax and the proceeds from selling illegal alcohol through bank accounts in Britain, Cyprus, Hong Kong and Dubai.
  3. Robert Zduniak was tracked down to Prague to serve eight years after being found guilty of participating in a £17m tax fraud. He was part of a gang that processed smuggled raw tobacco in illegal factories.
  4. Over 4.8m litres of illicit fuel were distributed to unsuspecting motorists across the South East of England in a £3.5m fraud.
  5. A former Top Gear mechanic was jailed for helping a father and son abscond to Europe to escape sentencing for a £1m VAT fraud. The father and son were later extradited back to the UK to serve sentences of a total of eight years.
  6. Five men sentenced in 2107 and already serving a total of 43 years in jail for a £107.9m tax fraud in a fake eco-investment scheme were ordered to repay another £20 million.
  7. An unemployed man with expensive social habits was found guilty of denying HMRC £1.2m in unpaid taxes in a tobacco smuggling scam.
  8. A charity treasurer, who tried to steal over £330,000 from a Gift Aid repayment fraud, was jailed for three years.
  9. Three men were jailed for smuggling millions of pounds into the UK. It was their part in a pan-European gang involved in cigarette trafficking, drug smuggling and money laundering. 

Apart from high-profile prosecutions, HMRC also issued a record fine. A West London money transmitter, Touma Foreign Exchange Ltd, was found to have ignored anti-money laundering rules and was fined £7.8m. Simon York, Director of HMRC’s Fraud Investigation Service said, “We know that criminals use money service businesses to disguise and move dirty money, and we’re determined to thwart them by helping businesses avoid being exploited in this way."

Tax officers, as part of the Paramilitary Crime Task Force, also seized cigarettes and cash worth nearly £2m linked to loyalist paramilitaries in an operation in Northern Ireland.

Useful guides on this topic

Penalties (VAT) (subscribers)
When do penalties apply for VAT? What penalties are charged and how can they be mitigated?

Money Laundering Regulations: Accountants' Registration
Money Laundering Regulations: if you provide accountancy services, book-keeping, or tax advice and you are not a member of a Supervisory body recognised under the regulations you must register your business with HMRC.

 

Corporate Criminal Offence: failure to prevent tax evasion
A new corporate offence of failure to prevent the criminal facilitation of tax evasion applies from 30 September 2017.

External links

HMRC reveals biggest criminal cases of year 2019

Criminal Finances Act 2017

 

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