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Is Your Business in Financial Trouble? Get Professional Advice!

HMRC2Small businesses are like babies to those who own them but that is no excuse for resorting to deceit when faced by financial problems. Getting professional advice is always the best option and, in one case that proved the point, a successful jeans designer, whose products were popular with Hollywood stars, received a lengthy sentence of imprisonment after he resorted to VAT fraud.

The man had enjoyed worldwide success but his business was hit hard by the 2008 financial crisis. His desperation led him to engage in a sophisticated fraud which involved claiming VAT rebates on imported jeans that did not exist. He moved small numbers of garments from office to office, repeatedly claiming VAT refunds. He gained almost £500,000 from the scam and, by the time he was caught, had lodged claims worth another £500,000 with HM Revenue and Customs.

He was ultimately jailed for five years after being convicted of fraud. The facts of the case emerged as the Court of Appeal reduced that sentence by six months. The Court noted that the business had for years been run legitimately, that it had not been set up as a vehicle for fraud and that the man was unlikely to reoffend.