UK tax authority HM Revenue and Customs (HRMC) has issued its annual report of top financial crimes of 2019, while also boasting that its fraud investigations have led to more than 600 people being convicted for their part in tax crimes during the past year.
One of the most notable cases in 2019 was the arrest of five men who lured individuals to invest in a fake eco-investment scheme as a tax break for wealthy investors. The £107.9 million ($142.1 million) fraud was one of the UK’s biggest tax crimes, said HRMC. The men had claimed that the money was being invested in carbon emission reduction certificates, which are intended to help countries meet environmental emissions targets set by the United Nations.
The money was diverted, however, to purchase properties in the UK and Dubai. The men were sentenced to more than 43 years in prison and ordered to pay £20 million or serve another 39 years in prison.
In another case, two “professionals” running the ironically named Ethical Trading and Marketing Ltd. were jailed for more than 14 years for attempting to steal in excess of £60 million through a fraudulent tax avoidance scam that falsely claimed to invest in HIV research and conservation. The two allegedly enticed wealthy investors with the promise of tax breaks through the support of tree planting in the Amazon and research into a HIV cure.
The men created false documents to fraudulently claim expenses and submitted fake scientific reports to HMRC and photos to support their claims. But there was no evidence the tree planting or HIV research had taken place. The pair were helped by Professor Ian Swingland, a world renowned conservation scientist, who joined the fraud to create the fake documents and add credibility to the scheme.
“This was a calculated and cynical crime carried out by men who had no shame in using a worthy cause like HIV research to mask their criminality,” Simon York, HRMC’s director of Fraud Investigation Service, said in a release.
Swingland, who founded the Durrell Institute of Conservation and Ecology at the University of Kent, was stripped of his Most Excellent Order of the British Empire (OBE) award due to his involvement in the crime.
The HRMC also cited its work with Interpol to break up a Europe-wide crime ring involved in money laundering as well as drug and cigarette smuggling that accumulated an estimated €680 million from their crimes between 2017 and 2019.
More than 450 police and customs officers in Spain, Poland, Lithuania, and Estonia carried out raids targeting members of the criminal network, which led to another 18 arrests across Europe. More than 40 properties were searched, which led to seizures of €8 million in cash, diamonds, gold bars, jewelry, and luxury vehicles, as well as a “substantial quantity” of illicit drugs and cigarettes.
“These prosecutions clearly show that we’ll relentlessly pursue those criminals who would try and cheat honest taxpayers,” said York. “It means we’re increasingly taking on ever more complex frauds and well-resourced opponents, including tackling organized criminals who would otherwise undermine our economy and harm our communities.”