Clothing wholesaler sentenced for VAT fraud
A Rochdale clothing wholesaler has given a two-year suspended sentence for forging documents to defraud almost £120,000 in VAT repayments
10 Oct 2018
Abdul Majeed, former company secretary of Rochdale fashion firms Majtex Ltd and Majtex International Ltd, submitted false invoices to fraudulently reclaim £119,624 in VAT repayments, although £14,353 was withheld.
Majeed admitted VAT fraud at Manchester Crown Court and has been given a two-year suspended jail sentence, 150 hours community service, and a compensation order of £70,271. He was also ordered to pay costs of £3,000. Majeed has repaid £35,000 so far and was ordered to complete the payments within the next 18 months.
An HMRC investigation found Majeed used legitimate suppliers’ invoices as templates to create false sales and purchase documents. He then used the fake invoices as evidence of supposed additional UK and overseas sales and purchases.
HMRC officers raised concerns about the invoices and alleged overseas sales and Majeed was offered the opportunity to disclose any tax irregularities within 60 days, under the contractual disclosure facility. He ignored the offer so HMRC launched a criminal investigation into the clothing firms and the suspected VAT evasion. Shortly after, Majeed deregistered Majtex International Ltd for VAT.
Paul Maybury, assistant director, fraud investigation service, HMRC, said: ‘Majeed has finally admitted his crime and is paying for his greed. He had the opportunity to put his tax affairs in order and not be criminally investigated, but he ignored HMRC and now has a criminal conviction for tax evasion.’
Report by Pat Sweet