Brothers jailed for 14 years for £3m tax fraud
7 Feb 2019
Three brothers, who ran a £3m tax scam involving pubs and restaurants across southern England, have been given jail sentences and banned from being directors for a total of 28 years
7 Feb 2019
Bournemouth brothers Shahab Hashtroudi, Shahin Hashtroudi, and Hedayat Hashtroudi, ran pubs and restaurants in Hampshire, Dorset and Surrey, using the money to prop up their loss-making business empire and fund their lifestyle. Shahab Hashtroudi drove a Porsche and sent his child to private school.
From October 2008 they set up 11 companies, all of which failed leaving huge debts. None of the companies lasted longer than 24 months, with some trading for less than a year. Some failed to pay a single penny in VAT to HMRC, while also failing to pass on the income tax and National Insurance contributions (NICs) of their employees.
Their bookkeeper Tracy Carder, from Poole, enabled the fraud to continue by deceiving HMRC about the companies’ true tax liabilities. Her actions helped extend the life of some of these companies and allowed for further substantial amounts of VAT, tax and NICs to be fraudulently evaded.
The Hashtroudis’ firms went under the names of Alcatraz (including Alcatraz Dining Group Ltd, Alcatraz Pub Company Ltd, Alcatraz Restaurant Company Ltd and Alcatraz Wine and Beer Company Ltd); 8 Rivers (including 8 Rivers Inns Ltd, 8 Rivers Restaurants Ltd, 8 Rivers Pub Ltd); Apricot (including Apricot Pub Company Ltd and Apricot Restaurant Ltd); Alcatraz Group Ltd (formerly 8 Rivers Dining Ltd); and Candy Experience Ltd (formerly 8 Rivers Bars Ltd).
HMRC launched an investigation into the brothers after Apricot failed in similar circumstances to their previous businesses. Once the firms had been declared insolvent, they started trading again under a new name leaving hundreds of thousands of pounds of debt to HMRC behind.
After being disqualified as company directors, the brothers then became ‘shadow’ directors, pulling the strings behind the scenes.
Richard Wilkinson, assistant director, fraud investigation service, HMRC, said: ‘The Hashtroudi brothers were serial offenders in setting up businesses and ripping off the British taxpayer, by pocketing the income tax and NICs employees had paid and also VAT on sales.’
Following a seven-week trial at Southampton Crown Court the group of four were found guilty of cheating the public revenue of £3m. Shahab Hashtroudi was also found guilty of tax fraud with Candy Experience Ltd (formerly 8 Rivers Bars Ltd).
Shahab Hashtroudi was given a six year jail sentence, Shahin Hashtroudi four years and Hedayat also four years. Carder received a two year jail sentence, suspended for two years, and was ordered to do 300 hours of unpaid work.
In sentencing the quartet, the judge described Shahab Hashtroudi as the ‘orchestrator’ of the fraud and ‘the power behind the throne’, saying: ‘You involved others in this fraud by pressure, by persuasion, by force of personality or by playing on the desire of some to keep their jobs.’
Confiscation proceedings are underway to recover the proceeds of the crimes.
Report by Pat Sweet