Fraud Gang jailed for £30 million Tax Scam

Three fraudsters have been jailed for a total of 21 years for their roles in a tax scam worth nearly £30 million.

The trio were prosecuted over a bogus IT project which saw them claim to be developing an IT healthcare system for two countries in the Middle East.

Matthew Sutherland was the leading figure of the tax scam. He used his company, Convergica (Clinical Information Systems) Ltd, in order to claim tax relief of £29.5 million against a purported £137 million spend on the bogus project.

Mohammed Zeb Zaheer and Mohammed Iqbal Khan were the front men for companies used to carry out the scam.

It came to light when HMRC requested supporting documents for the claim.

A fraudulent bank statement was submitted in January 2016, resulting in an investigation.

Convergica claimed to have outsourced the programming work for the IT system to Mediatronix Ltd, a company controlled by Khan, which was allegedly paid more than £137 million by Everbright Financial XII Ltd, controlled by Zaheer, on Convergica’s behalf.

However, the payment was not made and the claim for Research and Development (R&D) tax relief was fraudulent.

R&D is a form of tax relief for capital expenditure on research and development projects.

The £29.5 million claims was not paid out by HMRC.

In March 2018, the three men were charged with fraud.

In September 2018, the trio pleaded not guilty to conspiracy to cheat the public revenue at Birmingham Crown Court, however, following an 11-week trial, they were found guilty.

Kath Doyle, deputy director of HMRC’s Fraud Investigation Service, said:

“These men tried to extract an astronomical sum of money by claiming tax relief from a scheme designed to help legitimate companies do work that seeks to make advances in science and technology.

“This wasn’t research and development, it was out and out fraud.”

“HMRC will continue to create a level playing field for law-abiding businesses by rooting out the minority who seek to abuse these schemes, as this result clearly shows.

“Anyone with information about any type of tax fraud can report it to HMRC online or call our Fraud Hotline on 0800 788 887.”

Coventry Telegraph reported that on November 26, 2020, the three fraudsters were jailed.

Khan, aged 53, of Foleshill, Coventry, was jailed for seven years.

Zaheer, aged 37, of Cheylesmore, Coventry, was jailed for five years.

Sutherland, aged 44, of Leamington, was sentenced to nine years. He was jailed in his absence as he is in Dubai and is too ill to travel.