Six members of a crime ring, including their boss, an engineer from East Sussex, have been jailed for a £107.9 million fraud following a ten-year investigation.
According to a statement from HM Revenues and Customs (HMRC), they were given sentences totalling 45 years for devising a fake eco-investment scheme as a tax break for wealthy investors in one of the UK’s biggest tax crimes at Southwark Crown Court yesterday.
They were previously found guilty of cheating the public revenue by a jury, having pleaded not guilty to their crimes in February.
Sentencing the men, judge Andrew Edis said: “You played with high stakes and lost. It was bare-faced dishonesty and you did everything to inflict loss on the public, the people who pay their taxes, who were also victims.
“It was utter dishonesty, sophisticated planning and astonishing greed hidden behind a mask of concern for the environment.”
The men, led by Cambridge-educated engineer Michael Richards, 55, from Milton Street, Alfriston, East Sussex, lured wealthy individuals to invest in largely fake environmental projects with the promise of a tax break. He led the group to create and trade Carbon Emission Reduction Certificates, which help countries hit environmental emissions targets set by the United Nations.
The crime group, also made up of bankers, businessmen, a solicitor, used the investors’ money to fund their lavish lifestyles, buying properties around the world, expensive jewellery and enjoying luxury holidays.
But an intensive investigation by HMRC investigators lasting ten years revealed the scheme was nothing more than a fraud based on a complex series of contrived bank and paper transactions.
Richards was assisted by entrepreneur Robert Gold, 49, of Dubai, described in court as Richards’ bulldog and negotiator who ensured the fraudulent deals actually took place. He diverted money from the scheme to purchase properties in the UK and Dubai for himself.
Rodney Whiston-Dew, 66, from south-east London – a solicitor and former president of the Rotary Club of London – set up the complex offshore structures to disguise the true nature of the fraud and hide the money, none of which was declared to HMRC.
The other group members found guilty at Southwark Crown Court included environmentalist and business consultant Jonathan Anwyl, 44, of Yeomans, Ringmer, East Sussex.
Richards and Anwyl were sentenced to 11 years in jail respectively for their involvement in the fraud.
Simon York, Director of Fraud Investigation Service, HMRC said: “This was an audacious and cynical fraud on an astonishing scale, characterised by greed and a complete disregard for the ecological causes the perpetrators claimed to be supporting. Instead the group spent investors’ money on their own lavish lifestyles.
“These individuals thought they had worked out the perfect fraud. At every step they used contrived offshore structures, complex transactions and blatant lies in an attempt to hide their tracks and derail our criminal investigation.
“But the determination and professionalism of our teams has shown, yet again, that we will not hesitate to bring fraudsters to justice. Work has now begun to recover the proceeds of this crime in order to fund vital public services.”
According to the HMRC statement, there was no evidence to suggest investors – who are paying back the money they received from HMRC – knew the scheme was a scam or that their money was not being spent on research and development.
HMRC is seeking to recover criminal proceeds from the fraudsters. It is the latest of a string of operations to tackle serious multi-million pound frauds by wealthy professionals,