A FORMER Broughton man has been convicted in his absence of masterminding a huge £56m bogus VAT fraud.
Adam Umerji, 33, formerly of St John’s Court, Broughton, was one of the organisers of a gang of fraudsters that operated in the Preston area.
The scam saw large numbers of mobile phones sold from one company to another via “buffer” firms, before being exported abroad, often to Dubai.
In each trade, fraudulent claims were then submitted to claim back millions of pounds of VAT said to have been paid on the stock.
Sajid Muhammed Patel, 34, from Ferndale, Fulwood, Wai Fong Yeung, also known as Katie Yeung, 32, of York Avenue, Preston, and her partner Mohammed Mehtajee, 32, of Garstang Road, Fulwood, pleaded guilty to conspiring to cheat the public revenue at Liverpool Crown Court.
They also pleaded guilty to tranferring the proceeds of their activity out of the country in an effort to hide the illegal gains.
Umerji, Patel’s younger brother, and Abdullah Yusuf Allad, 32 - described in court as the “masterminds” of the scheme - were convicted of both charges in their absence.
They are both believed to be in Dubai and warrants had been issued for their arrest in connection with the charges. Earlier in the trial lawyers for Umerji claimed he was unable to return to the UK to attend the trial to try to clear his name because he’d been forced to surrender his passport to authorities in Dubai, as part of a separate ongoing civil dispute over a business deal.
The gang operated a number of companies in the Preston area to carry out the VAT scam.
Often, stock which had been exported abroad would then be imported back to the UK to be re-used in another transaction “chain”, the court heard.
In the main company involved in the scam, Eurosabre Ltd, investigators found 72% of the phones being traded by them had previously been sent for export.
In the 10 months between September 2005 and the end of June 2006, VAT claims worth a combined £56.5m were made. More than £37m was paid out. It was only when Her Majesty’s Revenue and Customs investigators started to investgate, partly alerted by a suspicious solicitor as some members of the group attempted to invest vast amounts of cash in commercial property in Preston, that further payments were stopped, and the size of the scam became clear.
Andrew Menary QC, prosecuting, said: “They conspired, together with others, to cheat the revenue out of what, in any view, were vast sums of money.”
Umerji and Allad, of Black Bull Lane, Fulwood, were jailed for 12 years for the first charge and five for the second, to run concurrently.
Mehtajee was jailed for four years, with two years on charge two to run concurrently.
Fong was jailed for two-and-a-half years, with the same sentence on count two to run concurrently.
And Patel was jailed for two years, with two years on count two to run concurrently.
Michael Wood QC, defending Patel, said his client had pleaded guilty as early as he could, and on the basis that his role in the scam was a minor one.
He said the fraud had been “up and running” before his client got involved.
He also said he was of previous good character and had “played fair” with the court, which had altered his bail conditions twice so he could travel to Dubai.
Alistair Webster QC, defending Fong, said her husband Mehtajee fully accepted that he had “heavily influenced” her getting involved with the scam and she otherwise would not have been involved at all.
He also said her father died soon after she was arrested and her grandmother had also died. Her mother was unwell and her husband had suffered mental problems.
She had a young son with Mehtajee who she would have to leave if she was jailed.
Guy Gozem QC, for Mehtajee, said he had repaid the faith in him being bailed.
But the case had meant his health had suffered significantly and he has suffered a “major depressive episode.”
Mr Gozem said his client had suffered hair, weight and appetite loss and had fought suicidal thoughts.
But, jailing the gang, His Honour Judge David Swift said the scam was “carefully and cleverly organised.”
He added that he accepted Allad and Umerji were the “main controlling minds” of the fraud and the other defendants had played much lesser roles.
But he added: “This was, of course, taxpayers’ money, and since that money ... is used for the provision of public services when sums of this size are involved, the damage to the public purse is substantial.”