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VAT man claims five fraud scalps

Prison sentences total 28 years...

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Customs and Excise today secured a seven-year prison sentence for a mobile phone salesman convicted of a £16m VAT fraud.

Monmohan Singh Sandhu, of Birmingham, was convicted at Southwark Crown Court for his part in a missing trader intra-community (MTIC) scam. This involved buying mobile phones from Luxembourg, claiming they were purchased in the UK and claiming the VAT back.

MTIC fraud usually involved a criminal registering for VAT, buying goods from the EU free of VAT, selling them on at a VAT-inclusive price to customers - and then doing a runner with the tax, rather than paying Customs.

Sandhu's case was slightly different. Between June and July 2001 he claimed to have bought 470,000 phones from MS Coton Ltd, whereas in reality he had bought them, free of VAT, in Luxembourg. More than £110m passed through his account during this period. Through his company Bestline Data Ltd ,he sold the phones on to one customer and tried to claim back the VAT.

Customs and Excise is launching action to recover £6m of Sandhu's assets.

Chip fraud

In a separate case, heard today in Snaresbrook Crown Court, four men were sentenced to between four and eight years in prison for their part in a VAT carousel which ran from February to March 2001. The four imported computer chips from the Republic of Ireland. The chips then passed through various buffer companies before being re-exported to Ireland and then re-imported to Britain. £7m in VAT which should have been paid to Customs was siphoned off. A previous carousel scam run by the team in 2000 netted them £9m.

Paul Vass, 37, Weybridge, was jailed for eight years. Richard Anthony How, 37, Bedfordshire got four years and Anthony Perkins, 64, also of Bedfordshire, was sentenced to four years. The fourth man, who cannot be named for legal reasons, received a five-year sentence.

Customs and Excise sees MTIC fraud as a top priority and has a 400-strong team tackling the crime. It aims to reduce the amount lost to such crime by half or £750m a year, the end of 2003-2004.

Arthur Gilchrist, Customs' assistant chief investigations officer, said: "We will continue to clamp down hard on those who abuse the VAT system and this sentence should serve as a warning to all those involved." ®

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