VAT fraudster ordered to repay £2.2m

A man who falsely claimed to be an accountant and was sentenced for his role in a complex VAT repayment fraud involving fake construction companies, has now been ordered to repay more than £2.2m or face a further period in prison

Salim Sakaria, from Preston, was given a five-year jail sentence in May 2014, after admitting VAT fraud following a long and complex criminal investigation by HMRC which established he was one of the key players in an 11-strong crime gang that attempted to steal £4.2m between 2009 and 2011.

The gang, led by Sakaria, used 20 companies in an attempt to disguise the fraud, one of which was a genuine building company, while the other 19 were fake construction companies. They used ‘puppet’ directors, fake invoices and bogus building contracts for housing developments as a smokescreen to hide their criminal activity.

People were paid up to £35,000 to act as directors and allow the gang to use their names and addresses for the bogus companies to claim illegal VAT refunds. Twenty companies were repaid £2,932,084 for fake VAT claims before HMRC froze repayments.

Sakaria, who worked at Forte Accountants in Preston, lied about being an accountant. Voice recognition technology showed he had contacted HMRC by phone about the fraudulent VAT repayments.

The court case arising from HMRC’s investigation was held at Manchester Crown Court over several years, concluding in 2014 with jail sentences totalling 17 and a half years for 11 people.

At the time, HMRC investigators found that as well as owning six properties in the Preston area valued at £408,464, a designer watch and a Mercedes Benz car, Sakaria had almost £2m in cash generated by the fraud some of which had been transferred to Dubai.

He has now been ordered to repay £2,276,149 within three months or serve a further compulsory seven and a half years in jail as a default sentence.

HMRC investigators arranged a restraint of Sakaria’s assets while the confiscation proceedings progressed through the courts. Any sale of the restrained assets will now be used to fund the confiscation payment.

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