A fraudster hs been sentenced to six years imprisonment for his part in an estimated ?57m mobile phone VAT scam following a lengthy investigation by HM Revenue & Customs (HMRC).
Mark Selby pleaded guilty at the Royal Courts of Justice to his involvement in a Missing Trader Intra Community (MTIC) VAT fraud involving the bogus sale of mobile telephones between May 2002 and May 2003. He was sentenced to five years imprisonment for cheating the Revenue, six months imprisonment for associated money laundering offences and six months imprisonment for each of five counts of contempt of court. The contempt of court sentences are to run concurrently, but consecutive to sentences for the other two offences.
Robert Gray, HMRC Assistant Chief Investigation Officer said: "Tackling this type of crime is HMRC's top fraud priority. MTIC fraud is a deliberate attack on the VAT system, perpetrated by organised criminals operating across and beyond the EU. The theft of huge sums of taxpayers' money has a direct effect on the Government funds that are available to spend on public services such as schools and hospitals.
"Today's sentence is a further example of HMRC's determination to bring to justice the criminals involved in this type of fraud and also vigorously pursue the recovery of their criminally derived assets."
The fraud was operated through various companies that were set up to trade in mobile telephones, including Selby's company, Maple Link France (SARL). During the period ?326.5 million was credited to Mr Selby's company account as payment for telephones sold to twelve UK companies.
He also supplied mobile phones to Spanish traders who in turn supplied the same 12 UK companies. These UK companies then failed to pay the VAT due to HMRC. The total VAT stolen amounted to approximately ?57 million. It is believed that Selby's personal profit from the scam amounted to around ?1.5 million.
An analysis of the trading chains reveals that there was no legitimate commercial sense in the buying and selling of the telephones. It was not necessary for there to be any commodity. The profit element in the transactions was solely in the stolen VAT.
Much of the proceeds from the fraud ended up in either Mr Selby's personal account, the account of Maple Link or was transferred to accounts held abroad. Mr Selby worked from his base in France. However, the company bank account is in London.
HM Revenue & Customs officers arrested Selby and applied for his extradition from France to the UK and this took place in November 2004.
This case was successfully prosecuted by the Revenue and Customs Prosecutions Office (RCPO). RCPO is an independent prosecuting authority that reports to the Attorney General, and is responsible for the prosecution of all HMRC cases.