A fraudster was jailed for five years on Friday after been found guilty of involvement in a multi-million pound mobile phone VAT fraud scam.
Craig Jones, 32, of Hanley, Stoke-on Trent, attempted to defraud Customs of £3.5 million in duties from the sale of mobile phones worth an estimated £19 million, the Daily Mirror reports.
Jones acquired the phones In Europe through his company Hallberg, VAT-free, charged tax to customers in Britain before attempting to skip before paying Customs the money he owed, Stoke Crown Court heard.
Customs estimates this type of 'missing trader' fraud will cost the government between £1.7 and £2.75 billion during the current tax year (ending April 2003). To tackle this type of fraud, Customs have assigned 340 staff with the goal of reducing missing trader fraud losses by at least £750 million by the end of 2003-04.
There are concerns that the Customs clampdown, however well motivated, might slow down or hamper the business of legitimate mobile phone traders.
One tax consultant, Don Mavin told The Guardian: "Customs are panicking. They're under huge pressure to stop the leakage and are refusing to pay out VAT repayments until they have checked through the entire trading chain."
Two of Mavin's clients considered a judicial review of customs' actions, it reports.
In their attempts to crack down on missing trader fraud, Customs have begun visiting all newly VAT registered firms in the mobile phone business. In response to this, crooks are changing their tactics filling VAT registrations without mentioning any involvement in the IT or mobile phone industries. Some even attempt to pass themselves off as plumbers, The Guardian (which looks various tactics used by fraudster in depth) explains. ®
Stoke-on-Trent has reportedly become a centre for VAT missing trader fraud in the UK. We've no idea why crooks involved in this type of scam have set up shop in the Potteries.