A criminal gang found guilty of an £11m VAT carousel fraud * involving computer chips has been sentenced to a total of 31 years in jail. Confiscation orders totalling £7.1m have been made against some of the nine gang members.
The convictions in a three trials at Blackfriars Crown Court follow a joint Customs and National Crime Squad (NCS) surveillance investigation into the criminal activities of Raymond May and Vincent Stapleton.
In a highly complex operation the criminal organisation established companies in England and France to buy and sell high-value computer chips in what is called a 'carousel' fraud.
The NCS uncovered the VAT fraud in April 2000, following the establishment of a business premises in South West London by Vincent Stapleton and this led to the joint investigation with Customs.
Economic Secretary to the Treasury and Customs Minister, John Healey said: "Customs Law Enforcement has dismantled a sophisticated international
fraud organisation. These criminals enjoyed wealthy lifestyles with big houses and luxury cars. We will make every effort to pursue not only the criminals but their profits too and hit them where it hurts the most - their pockets."
A National Crime Squad spokesman, said:
"This verdict sends a clear message to all criminals that the resources of the National Crime Squad and Customs & Excise will be brought to bear on those engaged in serious and organised crime, including those who perceive that this type of fraud is low-risk, high-return. It is an excellent example of inter-agency cooperation."
Actually, the last trial was last year, so why is Customs publicising the convictions now? VAT missing trader fraud, mostly involving computer chips and mobile phones, has grown exponentially in the UK. And Customs is keen to show that it will chase after criminals and secure their convictions.
This week, the Office for National Statistics(ONS)revised (pdf) The UK's trade statistics for four years to reflect the impact of missing trader intra community fraud. According to the ONS, the fraud involved the previously unrecognised importation of £23bn worth of goods, during the period, with £11.1bn of this coming in 2002 alone.
In April, The Government announced its intention to impose rules which would see companies rendered liable for VAT bills if any broker in its supply chain was discovered to be fraudulent. In response, Carphone Warehouse put on ice its phone distribution business while it assessed the impact. Many legitimate CPU and memory chip brokers, and system builders which dabbled in CPU broking on the side, are retiring from this market, too.
Now for the list of convictions.
Raymond George May, of Chislehurst,Kent 46, pleaded guilty on 20.09.01 and was sentenced to five years. In August 2002 a confiscation order of £3,264,277 was made with three years given to pay or a further five years in default.
Vincent John Stapleton, of Kingston, Surrey, 52, pleaded guilty on 20.09.01 and was sentenced to five years. A confiscation order of £2,365,769 was made with three years to pay or a further five years
Jacques Bravard, a Frenchman living in London, NW9, 47, pleaded guilty on 20.09.01 and was sentenced to five years. A confiscation order of £1,386,383 was made with three years to pay or a further
five years in default.
Herbert Fowles, 52, West Norwood, London, pleaded guilty in July 2002 and was sentenced to two years. A confiscation order of £66,000 was made.
Darren Hope, 32, West Norwood, London, pleaded guilty in October 2000 and was sentenced to two years.
Vincent Stapleton Jr, of , Kingston, Surrey, 22, pleaded guilty on 20.09.01 and was fined £10,000.
James Pullen, of Addlestone, Surrey, 47, was found guilty on 08.12.01 and sentenced to three years. A confiscation order is yet to made in his
Steven Lawrence, of Minster, Isle of Sheppey, 41, was found guilty on 08.12.01 and sentenced to four-and-a-half years imprisonment. A confiscation order has yet to made in his case.
Robert Brown-Jones, was sentenced to four-and-a-half years imprisonment at the High Court in Edinburgh in November 2001.
* HM Customs definition of VAT Missing Trader Fraud.
VAT Missing Trader Fraud or 'Carousel' fraud involves importing goods into the UK from the EU that are correctly zero-rated for VAT.
The goods are then sold on through a series of companies in the UK, all liable to VAT at the standard rate, before being exported back to the EU. In this particular fraud the goods were exported back to the
original supplier. The company importing the goods incurs a considerable VAT debt as it has to account for VAT charged on the sales. It has no VAT repayment claim as the goods were zero-rated on import. In a fraud of this type this initial 'link' in the chain 'goes missing' and never accounts for the VAT due.
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