Brian Brader, 35, from Chatteris near Ely, set up NKB Recycling in September 2010, claiming to export waste products such as cardboard and plastics to China and India.
However, it was found that Mr Brader claimed back VAT for exporting material, while his firm was in fact mainly trading this material within the UK, according to a spokesman for HM Revenue and Customs (HMRC).
The HMRC spokesman said Mr Brader’s firm “wasn’t doing much in the way of exports to our knowledge,” and that “he had nothing to support his VAT repayments – he had a couple of entries [for exports] but nothing to the level he made out he was doing”.
Suspicions were raised after HMRC officers called at the company to check its business records, but instead of evidence to support VAT repayments, they found “fake invoices and fraudulent business records”.
The investigation also found that Mr Brader had drawn an £82,000 salary without paying any Income Tax or National Insurance.
Mr Brader was arrested at his home in the early hours of July 23 2013. He initially told officers that all of the claims he had submitted were correct, but later admitted producing more than £350,000 worth of fake invoices for transactions that had never actually taken place, according to HMRC.
HMRC also discovered that Mr Brader took £94,500 from the business in February 2013 in order to purchase property to rent out. This property was later sold for £131,000, although HMRC currently has a restraint order on these funds.
Sentence
Mr Brader was charged with Cheating the Public Revenue in March 2015 and pleaded guilty at Ipswich Crown Court on January 21 2016.
“Tax fraud is a serious crime and HMRC will continue to pursue those individuals or businesses who attack the tax system.”
Paul Barton
HMRC
He was then sentenced at the same court on Friday (March 4) to four years in prison and disqualified from acting as a company director for eight years.
Assistant director of HMRC’s Fraud Investigation Service, Paul Barton, said: “Brader had a total disregard for the rules; he faked invoices to claim over £1 million of taxpayers’ money which should have gone into public services. He also brazenly paid himself a huge salary without paying a penny in tax. This is simply not acceptable when other, honest businesses pay what they owe.
“Tax fraud is a serious crime and HMRC will continue to pursue those individuals or businesses who attack the tax system. Anyone with information about people who may be involved in tax fraud can contact HMRC’s 24-hour Hotline on 0800 59 5000.”
NKB Recycling
Meanwhile, NKB Recycling – which is registered at Tithe Road in Chatteris, Cambridgeshire – currently faces a compulsory strike off notice. It means the firm will be dissolved in three months’ time “unless cause is shown to the contrary”, according to Companies House.
In summer 2014, the company’s Creek Fen Business Park site was hit by a large fire which caused major damage to lorries and specialist equipment.
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