Fiaz Razzak Malik, a director of Fima Consulting Ltd, a wholesale mobile phone business based in Slough has been disqualified as a director by the High Court for 13 years for participating in contrived transactions with a view to gaining VAT refunds of over 1 million.
Mr Maliks disqualification from 1 July 2015 means that he cannot promote, manage, or be a director of a limited company until 30 June 2028.
This disqualification follows investigation by the Official Receiver at the Public Interest Unit, a specialist team of the Insolvency Service, whose involvement commenced with the winding up of the company, for unpaid VAT owed to HMRC.
The Official Receivers investigation uncovered that Fima Consulting Ltd participated in a form of VAT fraud known as Missing Trader Intra Community fraud (MTIC) and that Mr Malik (36) was a director of the company at the time it engaged in these activities.
MTIC is commonly known as Carousel fraud, as large consignments of electrical or other small item size high value goods are invoiced rapidly and repeatedly around trading chains, speeded up by movement on paper, with actual movement of goods only taking place as they enter or exit the UK.
Such fraud indicators included the rapid succession of same day trades without deliveries within the UK of goods sitting at a shared freight forwarder, the common use of the same offshore bank, and entering into payment arrangements involving third parties who were neither suppliers nor customers. All traders banked with the First Curacao International Bank which was shut down by the Netherlands Antilles authorities in September 2006 in order to prevent money laundering.
Commenting on this case Paul Titherington, Official Receiver in the Public Interest Unit, said:
This type of VAT fraud is very serious and a high priority for HMRC and the Insolvency Service. MTIC fraud has been a great strain on the public purse and has cost the tax payer many billions of pounds in fraudulent VAT claims. The Insolvency Service is committed to making directors account for their actions.