Christos Charalambous (58) of Palmers Green, London, completed over 6,000 self assessment tax returns for clients which included fictitious expenses claims in order to increase the tax repayments due. He also understated the income he received from client fees on his personal returns and failed to register, declare and pay VAT due on his accountancy firm Charltons. Many of Charalambous’ clients were from other EU countries and had little understanding of the UK tax system.

The court heard how Charalambous would submit tax returns for his clients to the Inland Revenue (IR) (up to April 2005) and HMRC (from April 2005) without showing his clients what information he was including. He would then receive the repayments from IR/HMRC, deduct a minimum of 15% fee and repay the remainder to his clients, who would not question the amount refunded as they trusted him to complete the returns correctly. The total amount of repayment claimed by Charalambous on his clients’ behalf was £11,222,472.

Between 1997/98 and 2004/05, he understated client fee income on his own self assessment tax returns by £807,406. He also failed to declare and pay £180,082 VAT due to HMRC.

He was found guilty on six counts of cheating the public purse at Blackfriars Crown Court following a trial that lasted seven weeks.

On passing sentence, His Honour Judge Richardson said: “The offences are more serious as you were a chartered accountant. HMRC ought to be able to trust you as should your clients. You exposed them to the dishonesty that you practice. With tax enquiries, you responded with evasion and lies.” 

“Charalambous is a thoroughly dishonest accountant who was motivated by greed. He betrayed the trust of innocent and vulnerable people to feed that greed. This deprived the nation’s public services of millions of pounds. Our aim is to pursue and prosecute those involved in this type of criminal activity and reclaim the proceeds of their crime,“ said Steve Armitt, assistant director of criminal investigation for HMRC.

A Confiscation Order is being pursued.

The new Dutch Crimestoppers operation saw the arrest of its first target yesterday.

James Vincent Muldoon, 30, of Liverpool, absconded from his trial for armed robbery in 2007 and was sentenced in his absence to 13 years in prison.

He was believed to be on the run in the Netherlands and became one of six men on the ‘most wanted’ list when SOCA, Crimestoppers UK, BelM (Dutch Crimestoppers), Amsterdam Police and the Amsterdam office of the Public Prosecution Office launched Operation Return in March.

This joint initiative aims to prevent UK fugitives hiding from the law in Amsterdam. A similar Crimestoppers campaign in Spain – Operation Captura – has successfully led to the return of 31 of the 50 most wanted fugitives hiding out on the Spanish Costas. Some of the criminals wanted there are thought to have moved on to Amsterdam because the campaign in Spain made life too uncomfortable for them.

Muldoon was arrested on 21 April at a house in Amstelveen. He is now in custody and will appear before a Dutch court in the near future in relation to his extradition to the UK.

Norley Hall allotments in Wigan has been given £5,000, which was raised through the police’s payback scheme.
Under the scheme, money raised by criminals is given to the community.

The allotment was set up to encourage youngsters who had been involved in anti-social and criminal behaviour to give something back to their community.

The young people will use the area to grow flowers and plants which will be given to local victims of crime, police said.
Insp Phil James, of Greater Manchester Police, said the scheme, which is in its first year, had led to a reduction in anti-social behaviour and criminal damage in the area.

Fraud – including scams, online theft, insurance cheats and tax fraud – costs the UK £30bn a year, according to an official estimate.

The National Fraud Authority (NFA) has calculated the figure for the first time and said it equated to £621 per adult in the UK. Some 58% of fraud was in the public sector, at a cost of £17bn, it added.

It said the losses were paid for through taxes and rising prices of products and services.  The highest sector was losses from tax fraud – estimated at £15.2bn – although this was only 3% of tax liabilities, the NFA said.
  
According to the NFA, which is part of the UK Attorney General’s Office, some 31% of losses came in the private sector, with the financial services sector suffering the biggest hit.

It lost an estimated £3.8bn, including £1bn in mortgage fraud. This has prompted the City watchdog, the Financial Services Authority, to take a tougher stance against the crime, with a number of brokers having been fined and banned from the industry.

Another £2bn was lost to insurance fraud, and the remainder came from fraudsters targeting online banking, cheques, and plastic cards.

The consumer goods industry lost an estimated £1.3bn a year. Manufacturing suffered losses of £1bn a year, and technology, media and telecommunications lost £948m.

Consumers have also been tricked out of an estimated £3.5bn a year in share, lottery and loan scams. Some 12% of all fraud was suffered by individual consumers.

“Although the figure appears on the face of it far greater than the previous estimate, we know this is because we have included many additional figures that other studies have not,” said NFA chief executive Bernard Herdan.

“With this vital information we can develop clearer priorities to prevent, detect and deter fraudsters. We will use the data to help identify those areas of fraud that cause the most harm to the UK economy”.

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Police officers and police community support officers (PCSOs) from the NPT entered the unemployed man’s home yesterday afternoon using a warrant obtained under the Theft Act, as part of an investigation into handling stolen goods.

Inside the property officers found a large number of high-quality electrical goods including a plasma television, stereo system, laptops and computer equipment, and kitchen items, worth thousands of pounds. The man was also found to have £5,200 in cash in his coat pocket.

The man was able to produce receipts for the items, but these were all paid for in cash and he is believed to have been unemployed for a number of years.  He was arrested on suspicion of money laundering, and after being interviewed he was bailed pending further enquiries.

The cash has been seized by the Proceeds of Crime Team, who will now carry out an investigation into the man’s lifestyle to determine how he has acquired his assets without a declared income.

If it can be proved that these assets have been acquired through criminality, the Team can then apply to confiscate them under the Proceeds of Crime Act 2002.

Why Should They?
Detective Sergeant Tom Walsh of the City and Holbeck Proceeds of Crime Team said: “Anyone who has expensive possessions but no obvious income must raise eyebrows among people who earn honest livings in our communities, and I would appeal to these residents to contact the Why Should They? campaign if they have any suspicions about how these people have acquired their assets.”

The warrant was carried out following information from the community, and Inspector Damien Miller of the Holbeck NPT said: “We’re keen to show local residents that we’re listening and will act on the information they give us. Warrants like this are a great example and I would encourage people to continue contacting us about the issues they want us to tackle.”

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Steve Head, detective chief superintendent at the City of London Police, says the move represents a significant step forward in what has been a complex investigation.

He says: “The size of the police operation was evidence of the scale of this suspected fraud. It is not just the lenders that are being hit by the fraudsters. Individuals are losing millions and millions of pounds through a range of mortgage frauds, with much of this money being paid into the coffers of criminal networks.”

He adds: “We have a number of significant investigations ongoing and as lenders and borrowers continue to scrutinise their finances I anticipate many more cases being referred to us in the near future. I would ask anyone who has fallen victim to mortgage fraud to contact the City of London Police. The more we know the more difficult we can make it for those committing this highly damaging crime.”
 
The Solicitors Regulation Authority has backed the City of London Police’s crackdown on mortgage fraud.

A spokesperson says: “The SRA works closely with police and other law enforcement organisations to tackle mortgage fraud. Since the start of 2009 the SRA has stepped up its work in relation to mortgage fraud, both through advice and warnings to the profession, and by increasing its detection and investigation resources to prevent, deter and tackle fraud.”

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The plot centers on a complicated conspiracy through a version of ‘missing trader’ fraud which sees the creation of a contrived chain of companies, which claim to subcontract labour for the construction industry, with the sole intention of disappearing before paying the taxes due are payable under the ‘Construction Industry Scheme’ (CIS) to HMRC. These organised criminal gangs, in a bid to steal millions of pounds, pocket the money and hijack legitimate companies along the way.

This conspiracy exploits individuals working in the construction industry and it is believed thousands of construction site workers may have been robbed of the tax and national insurance contributions they have had deducted under the CIS scheme over the last six years.

Adrian Farley, Assistant Director of Criminal Investigation for HMRC, said: “Today’s arrests are the result of strenuous efforts by our teams of dedicated officers to disrupt the sophisticated scams of organised crime gangs behind money laundering activities. This conspiracy by a number of contractors is believed to have resulted in the theft of over £6 million from the public purse, depriving vital public services of much needed investment. We are committed to bringing them to justice and to deprive them of the proceeds of their crime.”

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JJB Sports revealed that it had stated its concerns about possible cartel activity in its market to the OFT which in turn has been granted immunity from any financial penalty in the event that competition rules have been broken.

The investigation follows an approach made by JJB to the OFT on January 30, following the suspension of its then chief executive Chris Ronnie. JJB asked at that time;

“for immunity pursuant to the OFT’s leniency programme in relation to a suspected agreement or concerted practice to dampen competition in the sports retail market in the period from 8 June 2007 to 25 March 2009, being the period in which the former chief executive, Mr Christopher Ronnie, was employed by the company.”

JJB did not name any other individuals or companies in its statement today. However, there was frequent speculation during Ronnie’s tenure about the nature of his relationship with Sports Direct and its founder Mike Ashley for whom Ronnie formerly worked.

OFT officers visited JJB at its Wigan head office this morning. It may be “some years” before the OFT investigation is complete. The retailer said in a released statement

“that in the event that any subsequent immunity agreement, is withdrawn as a result of JJB’s non-compliance with the conditions or as a result of JJB’s evidence being materially undermined in particular circumstances, and an infringement decision is issued by the OFT, JJB “may be liable for a fine from the OFT of up to a maximum amount of 10% of the Group’s turnover”.

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Judge Andrew Hamilton sentenced 70-year-old Warman, of West Bridgford, at Derby Crown Court. He told Warman, who was a self-employed accountant, that he was simply interested in using his clients to feather his own nest.

He said: “You cleverly manipulated the finances of clients in such a way that you provided yourself with a very comfortable lifestyle and could not possibly have afforded the running costs of the Bentley on his income. You ran it because you lived in this fantasy world. You took in everybody you ever dealt with.”

John Warman connived with his client, Simon Fields, who was a property tycoon to manipulate his tax returns to evade paying tax and then to pocket the proceeds.

Simon Fields, 34, of Trowell Road, Wollaton, pleaded guilty to one count of cheating the public finances to the tune of £392,000 by manipulating his business accounts. He was found guilty of one charge of conspiracy to ‘cheat the revenue’.

Warman was found guilty of that same charge and a further 28 others which 14 of them were for ‘cheating the Revenue’ and 14 further offences of obtaining money by deception. Both defendants had conspired to understate the profits from Fields’ property empire, and that of his father, Roger Fields, which John  Warman also managed the tax affairs of through his practice, stealing a further £1.5m due in tax revenues.

False accounts had been prepared showing a “reduced income” and an “increased expenditure” by understating the amount received for renting out the properties, and then overstating the interest paid on loans and the amount paid for repairs and renewals. These false statements were then submitted to HM Revenue & Customs, lying about the level of profit that had been made over a eight-year period from April, 1996, to April, 2004.

Warman had also acted alone in manipulating the accounts for a second time, stealing more than £1m by further corrupting the business accounts of Roger Fields. He also stole £80,000 from three other Nottingham businesses; a farmer, a firm of solicitors and a transport company.

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The type of businesses that is required to register with HMRC under the Money Laundering Regulations and be supervised accordingly are;

• Money Service Businesses
• Trust or Company Service Providers
• Accountancy Service Providers
• High Value Dealers

The focus of the visit will be on your business’s risk sensitive anti-money laundering policies and procedures to make sure they successfully manage and reduce the money laundering and terrorist financing risks faced by your business.

During a visit HMRC supervisory staff we will always:

• check that the information held on the HMRC register is correct
• check that the right people within Money Service Businesses and Trust or Company Service Providers have undergone the fit and proper test
• ask you to explain how your risk sensitive anti-money laundering policies and procedures work
• answer any questions you have on your legal responsibilities under anti- money laundering legislation
• look at your risk assessment of the business’s customers, products and services
• look at the anti-money laundering policies, procedures and training you have implemented to manage and reduce the risks you have identified.

They may also:

• examine transaction records and related documents to check that the customer due diligence measures have been adequately applied
• evaluate your systems for identifying and reporting suspicious activity to the Serious Organised Crime Agency
• check that your staff are aware of the law relating to money laundering and terrorist financing and are sufficiently trained to recognise and deal with suspicious activity
• ensure you have adequate systems in place to manage your compliance with the Money Laundering Regulations 2007.

If you are a Money Service Business or High Value Dealer HMRC may inspect any cash found on the premises.

The full document can be downloaded in PDF format by clicking on the following link  HMRC Guidance COP28

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