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Staffordshire scrap metal dealers jailed for VAT fraud

Staffordshire scrap metal dealers jailed for VAT fraud

A gang of scrap metal dealers has discovered that living a life of crime does not pay the kind of long-term dividends they were hoping for.

The Staffordshire gang claimed they were sending scrap metal overseas in order to claim VAT refunds totalling £1.5 million. They created false invoices that showed metals were being shipped to Cyprus via Belgium and to Ireland. In fact, the metals were just sent to another scrap yard in this country.

They also created false export paperwork so that they could justify charging VAT at the zero-rate. This let them keep the VAT instead of passing it over to HMRC.

37-year-old Michael Bostock, who was the leader of the gang, received a five-year jail sentence for his part in the fraud. At the time of his arrest he lived in house worth £1.4 million and drove around in a fleet of cars that included a Lamborghini Gallardo, a Ferrari Scaglietti and a Mercedes McLaren.

Gary Lampon, an assistant director of criminal investigations at the Revenue, explained that this was a sophisticated fraud that required a complex investigation. In fact HMRC spent 14 months investigating the gang before it conducted early morning raids in January 2008.

HMRC recouped cash worth £193,000 during the course of the investigation and confiscation proceedings to recoup the remainder are still ongoing. The Revenue is currently considering whether to take out Serious Crime Prevention Orders.

In this latest trial, six members of the gang received custodial sentences. Two other members were sentenced in 2010.

© 2012 All rights reserved. Reproduction in whole or in part without permission is prohibited.

Image: A scrap yard (1/2) by Gene Hunt

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