Quartet convicted over £30m CPU and phone VAT fraud

Four employees of Amber Communications Management found guilty of missing trader scam

Four fraudsters have been convicted of involvement in a £30m computer chip and mobile phone VAT fraud, HM Revenue & Customs (HMRC) has announced.

The government department today confirmed that four staff from Amber Communications Management Ltd (ACM) have been remanded in custody after being found guilty for their parts in a so-called "missing trader" VAT scam.

HMRC said the gang, who will be sentenced in April, had used their ill-gotten gains to fund lavish purchases including high-end vehicles, a boat and property in Dubai.

The fraudsters imported chips and phones from the US and Europe before selling them along a contrived supply chain and exporting them to Switzerland and Dubai, HMRC said. The traders at the start of the chain - which were in some cases set up purely for the fraud - invariably failed to pay the VAT charged on the original supply, it added.

HMRC said it had stopped attempts by ACM to claim VAT repayments worth more than £18m.

John Cooper, assistant director of criminal investigation at HMRC, said: "This gang stole vast amounts of money they neither earned nor deserved, all at the expense of honest people.

"HMRC works tirelessly not only to identify and stop fraud, but also to recover the profits of crime. Our next priority is to seek out the gang's assets, so that we can reclaim the proceeds of their illegal activities."

HMRC's website breaks down missing trader fraud into two types: acquisition fraud and carousel fraud.

In both cases, goods or services are acquired zero-rated from the EU, with the acquirer then vanishing without accounting for the VAT due on the onward supply. In the case of acquisition fraud, the goods or services are for domestic consumption but in the case of carousel fraud they are sold through a web of companies in the UK before being exported.

Companies involved in the chain can be innocent, however, and HMRC's policy in the past of withholding VAT repayments indiscriminately has been controversial.

Brian Murray and Ross Bell, from Kent (pictured right), were the directors of ACM during the fraud. They were found guilty at Kingston Crown Court on Thursday along with company secretary Lonnie Smith and London-based employee Garry Salter.

All four had denied cheating the public revenue and money-laundering offences during their trial.