WIREDGOV

Absconders sentenced for £56m VAT fraud

News Release issued by the COI News Distribution Service on 09 September 2011

Two men from Preston, who have absconded to Dubai, have been sentenced in their absence to 34 years in jail for their part in a £56.5 million ‘missing trader’ VAT and money laundering fraud.

The two men, Adam Umerji, 33 and Addullah Yusaf Allad, 32 were originally charged in January 2009, but absconded before they stood trial. Three others involved in the fraud who pleaded guilty prior to trial were also jailed for 15 years today at Liverpool Crown Court.

The gang operated a number of companies in the Preston area, trading in mobile phones. They submitted fraudulent VAT repayment claims to reclaim millions of pounds in VAT paid by them on the purchase of large quantities of stock. They then transferred their criminal proceeds out of the UK to Dubai in an effort to conceal their illegal activities.

Mike O’Grady, Assistant Director Criminal Investigation, HMRC said:

“Missing trader fraud is not merely a paper fraud, but often has links to other forms of criminal activity. In a blatant attack on our tax system these men stole a massive amount of money, lining their own pockets at the expense of the British taxpayer. We would encourage anyone with information on activities, which may be linked to tax fraud, to contact us on our hotline on 0800 59 5000.”

His Honour Judge Swift described the conspiracy in court today as “carefully and cleverly organised, in reality it was no more than a scam”. He added that Allad and Umerji “were the main and controlling minds of the fraud” and “that the scale of offending goes far beyond normal sentencing guidelines for sentencing fraud cases. This was taxpayers’ money otherwise used for public services and amounts of this size severally damage the public purse.

HMRC investigations discovered that £37 million had been laundered through the network of companies operated by the gang and halted further payments in 2006. The gang had submitted VAT repayment claims for over £56.5 million over a ten-month period.

Bench warrants were issued for the arrest of the two absconders and extradition proceedings have commenced. Those convicted in this fraud face future confiscation proceedings, which begin in November.

Notes to Editors

1. All five defendants were charged with two counts ‘Conspiring to Cheat the Public Revenue contrary to the Criminal Law Act 1977’ and money laundering under POCA legislation.

2. Details of the individuals sentenced today are:

Adam Umerji, also known as Shafiq Patel, (DOB 26/03/78) from St John’s Court, Broughton, Preston, PR3 5LG. Umerji was sentenced to 12 years in jail for the VAT fraud and five years for the money laundering. Umerji was also disqualified from being a director for ten years. There were many companies listed in evidence in this fraud, Umerji was principally linked to Eurosabre Ltd, Vertu Telecoms Ltd and Master Trading (UK) Ltd. Umerji is the younger brother of Sajid Patel.Abdullah Yusuf Allad (DOB 29/03/79) last known address was Black Bull Lane, Preston, PR2 3PA. Allad was sentenced to 12 years in jail for the VAT fraud and five years for the money laundering. Allad was also disqualified from being a director for ten years. Allad had many business interests but in this case was mainly linked to Eurosabre Ltd.Sajid Muhammed Patel (DOB 25/12/76) from Ferndale, Fulwood, Preston pleaded guilty on 3 May 2011 and was sentenced to two years in jail for the VAT fraud and two years for the money laundering. Patel was also disqualified from being a director for six years. Patel was also linked to Eurosabre Ltd, Vertu Telecoms Ltd and Master Trading (UK) Ltd. Patel is the older brother of Adam Umerji.

· Wai Fong (aka Katie) Yeung (DOB 16/04/79) formally of Garstang Road, Fulwood, Preston pleaded guilty on 6 April 2011 and was sentenced to two and a half years in jail for the VAT fraud plus two and a half years for the money laundering. Yeung was also disqualified from being a director for six years. Yeung was the partner of Mehtajee. Yeung and Mehtajee were involved with several businesses but principally Armada UK based in London. Yeung was also responsible for creating and operating Hong Kong Jai Hua International Ltd which was used to launder millions abroad.

· Mohammed Mehtajee (DOB 29/03/79) formally of Garstang Road, Fulwood, Preston pleaded guilty on 6 April 2011 and was sentenced to four years in jail for the VAT fraud and two years for the money laundering. Mehtajee was also disqualified from being a director for six years. Mehtajee is the partner of Yeung.

3. All sentences are to run concurrently.

4. Photographs of the individuals available from the press office below.

5. Follow HMRC on Twitter at: @HMRCgovuk

Contacts:

HM Revenue & Customs Press Office
HMRC-Press-office.NDSmanagement@hmrc.gsi.gov.uk

Helen Danson
Phone: 0151 703 1309
helen.danson@hmrc.gsi.gov.uk

HMRC Out of Hours
Phone: 07860 359544
NDS.HMRC@coi.gsi.gov.uk