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A British national, who resided in Switzerland, convicted of cheating the Inland Revenue of £54 million in taxes has been ordered to pay £16.25 million, as a result of a successful confiscation application. The confiscation hearing concludes an eight year investigation by HMRC, which resulted in a 10 year jail sentence for the defendant, Ian Leaf. Robert Alder, HMRC, Head of Restraint and Confiscation said: "Our colleagues in the Revenue & Customs Prosecution Office (RCPO) will whenever appropriate pursue confiscation orders against those like Mr. Leaf who attempt to line their pockets by depriving the country's essential services of vital resources. Confiscation orders ensure that such criminals are deprived of the financial advantages they seek to gain over the vast majority of honest people." Leaf's fraud was highly complex and centred on a company purchase scheme which involved the purchase of thirteen UK Subsidiary companies which were subject to UK tax. The companies were used solely for fraudulent purposes. Leaf was convicted of thirteen charges of fraudulent trading on 21 November 2005. When purchased by Leaf, as well as outstanding tax liabilities from past profits, the companies held enough cash to pay the tax owed. Rather than using the money to pay the tax, Leaf created fictitious documents from a bank registered in the Pacific island of Nauru which was controlled by him and appeared to show that the companies had borrowed huge sums of money. The resulting fabricated interest payments were offset against tax. It was also falsely claimed that these loans were used to undertake massively profitable foreign exchange deals which were not subject to UK tax out of which were paid dividends. Leaf then falsely used these to reclaim corporation tax rightly paid by the companies before he purchased them. In respect of the 13 companies included in the indictment the loss of tax exceeded £54 million with a further £22 million reclaimed but not repaid by the Inland Revenue to Leaf. Link HMRC: £16.25million confiscation order
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About The Author  Sarah Laing Sarah is a Chartered Tax Adviser. She has been writing professionally since joining CCH Editions in 1998 as a Senior Technical Editor, contributing to a range of highly regarded publications including the British Tax Reporter, Taxes - The Weekly Tax News, the Red & Green legislation volumes, Hardman's, International Tax Agreements and many others. She became Publishing Manager for the tax and accounting portfolio in 2001 and later went on to help run CCH Seminars (including ABG Courses and Conferences). Sarah originally worked for the Inland Revenue in Newbury and Swindon Tax Offices, before moving out into practice in 1991. She has worked for both small and Big 5 firms. She now works as a freelance author providing technical writing services for the tax and accountancy profession. |
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Article Added Thursday, 20 September 2007 | 980 Hits |
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