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Nearly 700 tax criminals convicted in 2013

Press Release   •   Dec 31, 2013 09:30 GMT

Almost 700 tax fraudsters and benefit cheats were convicted this year, HM Revenue and Customs (HMRC) announced today.

Between January and the end of November, HMRC investigations led to 690 successful convictions – up from 477 in 2012, and the highest since the 2010 Spending Review. These convictions led to sentences totalling 355 years in prison.

The investigations covered everything from complex VAT, income tax and benefit frauds to smuggling cases.

HMRC is also today publicising the top five tax cheat prosecutions of 2013, who between them share a combined jail sentence of over 75 years, on its Flickr gallery here: http://www.flickr.com/photos/hmrcgovuk/sets/72157639188067455/

Exchequer Secretary to the Treasury David Gauke said:

“The Government is determined to make sure people pay the tax they owe and HMRC will come down hard on those who try to cheat the system. Honest taxpayers will be pleased that these fraudsters are now paying for their crimes.

“We have invested nearly £1 billon in HMRC to tackle those who fail to play by the rules, and today’s figures clearly demonstrate that investment is paying off.”

Donald Toon, Director for Criminal Investigations at HMRC, said:

“These convictions send a clear message that tax fraud will not be ignored and tax fraudsters should be very concerned.  We are well on track to achieving our spending review commitment to increase the annual number of prosecutions to over 1,000 by 2014/15.

“The vast majority of people are honest with their tax affairs, but if anyone knows of somebody evading their taxes they should call HMRC and tell us.”

Tell HMRC about customs or excise fraud, or tax evasion, at http://www.hmrc.gov.uk/reportingfraud/online.htm

Notes to Editors

1. A tax evasion campaign has been launched by HMRC as part of the Government’s near £1 billion investment to tackle tax evasion, avoidance and fraud. This will aim to raise an additional £7 billion each year by 2014/15. Find out more at https://www.gov.uk/sortmytax

2. HMRC’s top five prosecutions of 2013 can be found on our Flickr account and below: 

Operation Hornbeam – £26 million tobacco fraud

A gang of tobacco smugglers masterminded by Daniel Harty and Billy-Jo Wall, who described their tobacco as “wet, mouldy and smells like manure, but sells because it’s cheap”, is behind bars after HMRC smashed their £26 million criminal operation.

The gang flooded the north of England with more than 150 million cigarettes and two tonnes of low quality tobacco. Under the direction of Harty and Wall the gang created a distribution network that transported millions of cigarettes throughout the north of England to warehouses, storage yards and farms. The shipments were then broken down into smaller loads and delivered to towns and cities across the UK to sell on the black market.

The nine members of the gang were sentenced to over 22 years behind bars. More detail here: http://www.mynewsdesk.com/uk/hm-revenue-customs-hmrc/pressreleases/what-s-wet-mouldy-and-smells-like-manure-881304

Operation Echowood – £5 million wine duty fraud  

Roberto Parma, 54, and Alberto Mori, 53, smuggled illicit Italian wine into the UK. The two men then sold it on without paying more than £5 million in duty and VAT.

Parma imported wine from an Italian-based company, Cantine Soldo spa, using the UK’s duty suspension scheme. Parma and Mori exploited this scheme by using the same delivery documents many times and avoiding paying duty by diverting the wine from the bonded warehouse, when duty would normally be paid.

Mori, a London wine merchant, worked with Parma to sell the imported wine illegally through a network of wholesalers around the UK.

Roberto Parma was found guilty of two counts of evasion of excise duty and VAT and sentenced to six years, seven months imprisonment.  Alberto Mori was found guilty of two counts of evasion of excise duty and VAT and sentenced to seven years. More detail here: http://www.mynewsdesk.com/uk/hm-revenue-customs-hmrc/pressreleases/wine-smugglers-sentenced-in-ps5m-wine-fraud-845960

Operation Dumpcart – £2.3 million VAT fraud  

A 17-strong criminal gang, masterminded by Paul Hackney, ran a £2.3 million VAT repayment fraud using the sale of fictitious concrete crushing machines to fund extravagant lifestyles.

The group fabricated transactions and sales of construction equipment. They produced fake invoices and paperwork to try and make their companies look like legitimate traders to reclaim VAT on sales and exports. They did not pay any VAT as the ‘goods’ didn’t exist.

The gang set up a string of companies to steal money from HMRC so that they could buy high performance cars, expensive jewellery and exotic holidays at the taxpayer’s expense. The 17 members of the gang were sentenced toa total to over 17 years behind bars. More detail here: http://www.mynewsdesk.com/uk/hm-revenue-customs-hmrc/pressreleases/vat-fraud-gang-crushed-890499

Operation Lilac Box – £2 million identity fraud

An organised crime gang stole more than 3,000 identities in an attempt to defraud at least £2 million of Income Tax repayments.

The four men, all Eastern Europeans who lived in Southampton and London, played different roles in the fraud against HMRC by submitting false Self Assessment tax repayment claims using stolen and hijacked identities.

The gang stole the identities of people who answered their classified adverts offering the possibility of work, and also created identities based on contact details found in other classified notices. Those whose identities were hijacked were mainly Polish people living in the UK, often London-based builders and construction workers looking for work or advertising their business services. The gang’s fake adverts appeared in a UK-based magazine aimed at Eastern Europeans.

The four men received jail sentences totaling over 22 years. More detail here: http://www.mynewsdesk.com/uk/hm-revenue-customs-hmrc/pressreleases/identity-crime-gang-jailed-for-attempted-ps2m-tax-fraud-896260

Operation Nightingale – £1.6 million fraud 

Michael Fearon was convicted of smuggling 8.4 million cigarettes and featured on a list of Most Wanted tax fugitives this summer.

After being named on HMRC’s Most Wanted list, Fearon, 21, from Newry, handed himself in to the authorities.

Fearon was arrested on 29 June 2010 in connection with the suspected evasion of excise duty on nearly 8.4 million cigarettes – costing the UK over £1.6 million in duty. However, Fearon absconded during his trial on 19 September 2012.

He was tried in his absence and found guilty and a warrant was issued for his arrest. On the 25 October 2013 he was sentenced as a minor to one year imprisonment and one year on license. More detail here: http://www.mynewsdesk.com/uk/hm-revenue-customs-hmrc/pressreleases/most-wanted-cigarette-smuggler-jailed-926812

3. Follow HMRC on Twitter @HMRCgovuk

4. Photos are available on HMRC’s flickr channel www.flickr.com/hmrcgovuk

Issued by HM Revenue & Customs Press Office

HM Revenue & Customs (HMRC) is the UK’s tax authority.

HMRC is responsible for making sure that the money is available to fund the UK’s public services and for helping families and individuals with targeted financial support.