£10M Tax Cheat Voudouri fled Scotland while Crown Office & senior cops bickered over credit, promotions & bonuses for prosecution ‘result’

Convicted £10m tax cheat skipped £100m Lord Advocate after sentence deal collapsed. INFIGHTING between prosecutors, Police & tax officials over who could take public credit for jailing convicted tax cheat Michael Voudouri allowed the fraudster to easily flee Scotland after the collapse of a secret lighter sentencing deal done with Scotland’s £100m a year Crown Office & Procurator Fiscal Service (COPFS).

The bizarre inter agency wrangling over bonuses, promotions, and even squabbles over the final wording of public statements after Voudouri was safely behind bars, came to light in a leak detailing the bitter recriminations being played out between the agencies who wanted to claim credit for putting Voudouri in jail.

In communications seen by journalists, several key players in the prosecution openly touted for promotions accompanied by higher salaries while others suggested they were “due bonuses for bringing the tax fraudster to justice”.

However, UK tax officials are said to have taken a dim view of the way the Crown Office handled the prosecution and poor presentation of evidence which led to prosecutors being forced to accept a guilty plea for much lesser amounts of fraud than had been alleged after thorough and hugely expensive investigations.

One tax insider branded the Crown Office handling prosecution as being so bad, that he felt such tax avoidance cases should be prosecuted in England & Wales by the Crown Prosecution Service, writing that the “Scottish Crown Office appeared to be riddled with strutting peacocks”.

Voudouri, who skipped bail after being found guilty, is thought to have fled to Cyprus, where newspapers tracked him down to various properties although he has since fled addresses in Cyprus attributed to him at the time.

At the heart of the case which led to the conviction of Voudouri was Q-Tech distribution, a company said to have made a fortune by claiming back VAT on false Europe-wide business transactions in a scam known as carousel fraud.

Prosecutors from the Crown Office said Voudouri was involved in funds being concealed and "removed from the jurisdiction of the Scottish Courts".

He set up bank accounts in Greece and Cyprus as well as limited companies across the globe to keep the cash away from the authorities.

Voudouri had been accused of laundering a total of £48.2m of money from Q-Tech. But the Crown accepted a guilty plea after the sum was reduced to £10.3m. He was bailed but failed to turn up for sentencing in November. Judge Lord Tyre immediately issued a warrant for his arrest after lawyer Vincent Belmonte said he had no way of contacting his client.

Voudouri was jailed for four years in 2004 when he admitted a £3m VAT scam although he was suspected of stealing 10 times that amount. He also admitted a separate charge of hiding £1.2m of dirty cash while he was serving a sentence in HMP Glenochil.

In June, a Proceeds of Crime recovery case against Voudouri had to be postponed for six months at the High Court in Edinburgh after the Crown admitted they had been unable to trace him. The court hearing relates to Voudouri’s Bridge of Allan home, which has been targeted under proceeds of crime laws.

Prosecutor Barry Divers told judge Lord Uist: “There are ongoing efforts being made to trace him and return him to this country for sentence and for completion of this confiscation.”

Earlier in March of this year, Voudouri’s lawyer Richard Housley and accountant Caroline Laing were jailed for six-and-a-half years for their part in an international money laundering network they set up for him.

At the High Court in Edinburgh, Lindsey Miller, head of the Crown’s serious and organised crime division, said: “After an extremely complex investigation, today we have seen justice delivered to individuals who participated in money laundering and fraud on an industrial scale.

“The investigation into their crimes has spanned the globe, with our economic crime unit gathering evidence from companies and financial institutions in the UK, Greece, Cyprus, Switzerland, the US and the British Virgin Islands.

"This case powerfully demonstrates the ability of our specialist units to prosecute cases of the utmost scale and complexity and bring to justice all those who seek to benefit from crime.”

Recently the convicted tax cheat was put on HMRC’s list of most wanted list, becoming Scotland’s top target.

No one from the Crown Office or Police Scotland was available for comment.

DEADLY DEAL : Secret negotiations involving Lord Advocate on £300 Million tax dodge case led to ‘questionable’ death of QC Paul McBride in Pakistan

A client too far : Secret deals over tax fraud case led to death of Paul McBride. SECRET NEGOTIATIONS between the highest ranking staff at Scotland’s Crown Office including the Lord Advocate, various Police forces, & Her Majesty’s Revenue & Customs (HMRC) in attempts to bring back to Scotland Imran “Immy” Hussain, 34 originally from Glasgow, who has been on the run from UK tax authorities for SIX YEARS after being accused of a THREE HUNDRED MILLION POUND TAX FRAUD, led to the untimely, and now increasingly questionable circumstances surrounding the death in a Pakistan hotel room of one of Scotland’s most celebrated lawyers, the late Paul McBride QC, who travelled to Pakistan with solicitor Aamer Anwar to meet Mr Hussain.

The Sunday Mail newspaper reported earlier this week “McBride told a friend that he was going to Lahore to meet a wealthy client wanted for a major fraud in the UK. Legal sources and friends of the lawyer, who was found dead in his room at the Pearl Continental Hotel, believe he met Hussain. McBride travelled to Pakistan with solicitor Aamer Anwar, 44, who said the lawyers attended a wedding during their stay.”

The late Mr McBride was to have represented Imran Hussain in any prosecution to take place in Scotland, however it has transpired the negotiations between McBride, who apparently “had authority from the Crown Office to deal on the case” did not play well into Mr Hussain’s wishes, who instead prefers to pay large fines rather than be sentenced to a lengthy stay in jail.

A legal insider who claims to know of the discussions said he believed parties within the negotiations had “got lippy over what was on offer and things did not go well from then on in”. Mr McBride was later found dead in his hotel room, the cause of which has not been accepted (at least in private) by some of his colleagues and legal observers.

A source has since come forward claiming he has copies of emails identifying a political dimension to the story, alleging an msp from [a party] was involved in some aspects of the negotiations. The source also suggested donations may have been made to the msp’s party, “depending on a result in the case had things gone better”. It has also been alleged the Scottish Government’s Justice Department “at it’s highest level” knew of the discussions between the late Mr McBride and the accused tax fraudster.

However, the Crown Office record on complicated fraud charges is poor, so poor one senior advocate has told Scottish Law Reporter he is “prepared to place a bet the Crown Office would rather make an offer in return for a guilty plea”. The advocate went onto claim he had heard papers relating to the Crown Office discussions with McBride had been destroyed after Mr McBride’s death, for fear of the material leaking to the media.

Was this case and the secret negotiations worth the life of Paul McBride QC ? Scottish Law Reporter thinks not.

The Sunday Mail reports :

DEAL ME IM : £300m tax dodge fugitive launches bid to return to Scotland

Apr 8 2012 Exclusive by Derek Alexander

SCOTLAND'S wealthiest fraud suspect is trying to strike a deal to return from Pakistan but keep his cash, we can reveal. Imran “Immy” Hussain, 34, has been on the run from HMRC investigators for six years over a VAT scam in which he allegedly stole £300million from UK taxpayers. It is understood that top QC Paul McBride, 47, met fugitive Hussain during the trip to Pakistan where he died last month.

Former sunbed shop boss Hussain has been in Pakistan since being forced out of the millionaires’ playground of Dubai. But associates have revealed that playboy Hussain is desperate to return to his home city of Glasgow to see his friends and family.

One source said: “He has everything he could wish for in Pakistan but it’s not home. “He has effectively been on the run since the end of 2006 and it’s time to come back but he will only do so if he can get the right deal. “He wants to come home – but not to spend 20 years in a cell. “His preferred outcome would be to hand over a large amount of his money and do a light sentence – that way, the authorities could say justice has been done and point to the cash seizure as a success.”

McBride told a friend that he was going to Lahore to meet a wealthy client wanted for a major fraud in the UK. Legal sources and friends of the lawyer, who was found dead in his room at the Pearl Continental Hotel, believe he met Hussain. McBride travelled to Pakistan with solicitor Aamer Anwar, 44, who said the lawyers attended a wedding during their stay.

Hussain had been living the high-life in Dubai, where he owned two luxury houses, a fleet of cars and a yacht. He also travelled to Europe by private jet. He spent fortunes on wild parties and thought nothing of buying Rolex watches for his pals. But he was forced to leave the desert kingdom when HMRC investigators were sent to track him down.

Hussain, from Newton Mearns, Glasgow, had already been in contact with HMRC about a possible deal. Sources have described communication between Hussain and HMRC as “very sensitive”. One legal source said: “Paul was in Pakistan in his professional capacity as an advocate. “He was there to meet a Scottish Asian who is wanted for VAT fraud and wants to come back to Scotland. “His contacts at the Crown Office were at the highest level and he operated and negotiated at such a level.”

Another associate of Hussain said: “Things got a lot more difficult for him when he had to leave Dubai. He realised that HMRC weren’t going to give up on him and he has now been in Pakistan for the last couple of years.”

Hussain is suspected of heading a Europe-wide operation who set up hundreds of bogus firms linked to VAT fraud, also known as carousel fraud. Gangs claim back VAT on goods they say were imported and then exported. But the goods – usually small but high-value items such as computer chips and mobile phones – never existed.

Huge bill for the carousel fraud gangs

Britain’s carousel fraudsters cost taxpayers £3.5billion a year at the height of their operations. That was how much the gangs – most of them based in Glasgow – stole in the import-export scam. The crooks claimed to bring in high-value small goods such as mobile phones or computer chips VAT-free from the EU. A VAT-registered firm would then “sell” the items in the UK to a criminal associate and add 20 per cent VAT. The items are then re-exported and re-imported, with the conmen able to continually claim multiple VAT rebates on goods that don’t exist.

Britain suffered its worst year at the hands of the fraudsters in 2006, losing £3.5billion. David Odd, of HMRC, last year said the figure had been reduced to between £500million and £1billion annually. This was largely due to an extended verification programme which postponed VAT repayment claims. Several hundred officers were also deployed to investigate traders who dealt in mobiles and computer chips and had a huge turnover in a short time.

Law firm with share of £20M Scots Govt contracts, office recently opened by Alex Salmond in Qatar, claims HMRC ‘being over zealous’ in gathering tax

Late Payers ? Law Firm McGrigors specialising in tax law & ‘late payment’ recently established new offices in Qatar, opened by First Minister Alex Salmond. MCGRIGORS, a Scottish Law Firm who recently won a little advertised share of £20 MILLION POUNDS worth of taxpayer funded Scottish Government contracts for DEBT RECOVERY & PROPERTY and who recently opened an office in the Gulf State of Qatar which was ‘officially opened’ by First Minister Alex Salmond on one of his ‘trips’ to ‘promote’ Scottish business, has claimed the UK’s Tax authorities, HM Revenue & Customs (HMRC) use of ‘distraint’ against businesses who dodge or fail to pay their taxes on time may be “over-zealous”.

Stuart McNeill, partner in the litigation and dispute resolution team at McGrigors, which is described by business insiders as a “specialist late-payment and tax law firm”said in a Press Release, attacking the use of seizure powers : “HMRC is under huge pressure to collect unpaid tax, but at the same time it is facing cuts in its staffing levels. It is almost inevitable that this is resulting in a more aggressive approach and short cuts, but as well as having drastic implications for late-paying businesses and their other creditors, it may also actually be counter-productive.”

Mr McNeill went on: “By barging in and selling the assets of a late paying company without making a proper commercial assessment of the firm’s medium term viability, HMRC risks sacrificing full payment in a few months’ time for far less cash up front.”

However, in these testing financial times for Scotland & the UK, where some now believe and campaign for the rich & their companies to pay their own fare share of taxes rather than indulge in tax dodging exercises & late payments, a spokesperson for HMRC countered : “We remain committed to doing everything we can to support viable businesses through short-term cash flow difficulties. However, there is little HMRC can do for a business whose viability is dependent on not paying the UK taxes to which they are liable, or on special treatment not available to other customers.”

While McGrigors are eager to advertise their tax specialist skills, their share of the £20 million Scottish Government contracts funded by taxpayers, the majority of whom cannot afford their services, has seen little publicity, although an investigation by independent law journalist Peter Cherbi revealed the law firm was among a host of others who were involved in hospitality offered & quickly taken up by Scottish Government officials. The report on this investigation was published on the Scots Law blog Diary of Injustice, HERE

Perhaps HMRC should now be taking a look at law firms, their partners & activities, including particularly some of those members of the Scottish legal profession and even some members of the judiciary who deal in or frequently fly off to offshore tax havens such as the Cayman Islands. (We know who you are even though you think no one is watching you … – Ed)