Mobile phone dealer handed 11 year disqualification for VAT fraud
Mr Shiraz Ahmed has been disqualified for 11 years for taking part in a £2m plus VAT fraud.
Mr Shiraz Ahmed, a director of G Comms Ltd, a wholesale mobile phone business based in Ealing has been disqualified as a director by the High Court for 11 years for participating in contrived transactions with a view to gaining VAT refunds of over £2 million.
The disqualification regime exists to protect the public and Mr Ahmed’s disqualification from 27 July 2016 means that he cannot promote, manage, or be a director of a limited company until 26 July 2027.
This disqualification follows investigation by the Official Receiver at the Public Interest Unit, a specialist team of the Insolvency Service, whose involvement commenced with the winding up of the company, for unpaid VAT owed to HMRC.
The Official Receiver’s investigation uncovered that G Comms Ltd participated in a form of VAT fraud known as Missing Trader Intra Community fraud (MTIC, for short).
This missing trader fraud is commonly known as “Carousel” fraud, as large consignments of electrical or other small item size high value goods are invoiced rapidly and repeatedly around trading chains, speeded up by movement on paper, with actual movement of goods only taking place as they enter or exit the UK.
Such missing trader fraud indicators included the rapid succession of same day trades without deliveries within the UK of goods sitting at a shared freight forwarder, failing to conduct adequate due diligence on trading partners, failing to arrange adequate insurance on the goods etc.
Commenting on this case Paul Titherington, Official Receiver in the Public Interest Unit, said:
This type of VAT fraud is very serious and a high priority for HMRC and the Insolvency Service. MTIC fraud has been a great strain on the public purse and has cost the tax payer many billions of pounds in fraudulent VAT claims. The Insolvency Service is committed to making directors account for their actions.
Notes to Editors
G Comms Ltd was incorporated on 13 July 2004. Its trading address was at Manhattan Business Park, Ealing, London, W5 1UP.
The petition to wind up the company was presented by HM Revenue & Customs in respect of unpaid VAT of £18,810 on 16 August 2013. The winding up order against G Comms Ltd was made on 30 September 2013.
On 21 June 2016 Mr Shiraz Ahmed gave an undertaking to be disqualified for a period of 11 years. The Secretary of State accepted Mr Ahmed’s undertaking on 6 July 2016. The period of disqualification will commence on 27 July 2016 and will run until 26 July 2027.
A disqualification order has the effect that without specific permission of a court, a person with a disqualification cannot:
- act as a director of a company
- take part, directly or indirectly, in the promotion, formation or management of a company or limited liability partnership
- be a receiver of a company’s property
In addition that person cannot act as an insolvency practitioner and there are many other restrictions are placed on disqualified directors by other regulations.
Disqualification undertakings are the administrative equivalent of a disqualification order but do not involve court proceedings.
Further information on director disqualifications and restrictions can be found here.
The Insolvency Service administers the insolvency regime, investigating all compulsory liquidations and individual insolvencies (bankruptcies) through the Official Receiver to establish why they became insolvent. It may also use powers under the Companies Act 1985 to conduct confidential fact-finding investigations into the activities of live limited companies in the UK. In addition, the agency authorises and regulates the insolvency profession, deals with disqualification of directors in corporate failures, assesses and pays statutory entitlement to redundancy payments when an employer cannot or will not pay employees, provides banking and investment services for bankruptcy and liquidation estate funds and advises ministers and other government departments on insolvency law and practice.
Further information about the work of the Insolvency Service, and how to complain about financial misconduct, is available.
All public enquiries concerning the affairs of the company should be made to: The Official Receiver, Public Interest Unit (South), The Insolvency Service, 2nd Floor, 4 Abbey Orchard Street, London WC1B 3SS. Tel: 020 7637 6438. Email: firstname.lastname@example.org
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Published: 19 August 2016
From: The Insolvency Service