Restaurateur served with ban over £570k tax fraud
24 Feb 2020
An Aberdeen restaurateur has been banned for 11 years after the discovery of almost £800,000 of payments that were not declared to HMRC
24 Feb 2020
This followed an Insolvency Service investigation which uncovered a hidden customer account set up by Syed Ahmed, the sole director of Blue Mango Tree Ltd, which went into liquidation in September 2018.
Incorporated in May 2009, the company traded as the Jewel in the Crown restaurant in Aberdeen and for five years made full tax returns to the tax authorities.
For more than three years between February 2014 and November 2017 Blue Mango operated a second bank account that had not been declared to the tax authorities.
Investigators from the Insolvency Service discovered that when customers used the restaurant’s credit card machine to settle their bill, payments were diverted to the undeclared account.
The investigation identified £797,587 worth of payments made by customers sent to the second account. The proceeds of that account, amounting to £123,000, were then transferred by Ahmed to himself and he withdrew a further £535,000 as cash.
This resulted in HMRC being owed just under £570,000 when the company went into liquidation.
Robert Clarke, chief investigator for the Insolvency Service, said: ‘Syed Ahmed knew exactly what he was doing when he diverted funds for his own purposes, in an attempt to avoid paying the tax authorities what they were rightfully owed.
‘This ban should serve as a warning to other directors tempted to help themselves first, you have a duty to your creditors and if you neglect this duty you could be investigated by the Insolvency Service, with the possibility of losing the privilege of limited liability trading.’