Two fraudsters, who attempted to steal more than £60m through a fraudulent tax avoidance scheme claiming to invest in HIV research and conservation, have been jailed for a total of 14 and a half years.
Ethical trading and marketing company director Antony Blakey and finance director, John Banyard “enticed wealthy people” to invest in the scheme with the promise of avoiding tax by supporting tree planting in the Amazon and research into a HIV cure.
The pair were aided by conservation scientist Professor Ian Swingland, 72, who joined the fraud to help “create the fake documents” and “add credibility to the scheme”.
An investigation by HM Revenue and Customs (HMRC) found the men created false documents to fraudulently claim expenses.
They submitted “fake scientific reports” to HMRC and photos to support their claims but there was “no evidence any of this had taken place”.
The men sold this scheme as a marketed investment opportunity when in fact it was fraud masquerading as avoidance.
Investors were able to claim tax rebates on the losses that the businesses apparently generated, or lower their tax bills, by offsetting losses against £160m ($213m, €186m) of income, attempting to avoid £60m in tax.
The majority of repayments claimed were withheld by HMRC.
Convictions revealed
Details of the convictions and sentences can only now be revealed after reporting restrictions were lifted on 25 February 2019.
The men were found guilty on 3 March 2017 after a trial at Southwark Crown Court that began in September 2016.
- Blakey was jailed for seven and a half years on 10 March 2017; revised to nine years at the Court of Appeal on 25 May 2017.
- Banyard was jailed for four and a half years; revised to five and a half years at the Court of Appeal, on the same dates.
- Swingland received a two-year sentence, suspended for 18 months.
HMRC is pursuing confiscation against the fraudsters to recover criminal proceeds and also pursuing those who invested in this now failed avoidance scheme to recover taxes due.
On 3 November 2017, Blakey pleaded guilty to evading Income Tax of £441,000 through the use of offshore companies and bank accounts.
On 25 February 2019, Banyard pleaded guilty to Income Tax evasion of £207,000.
Martin King, a financial planner who hid his true income by arranging payment of work he did with Blakey through an offshore company, pleaded guilty the fraudulent evasion of £235,000 Income Tax on 25 February 2019.
All three men had used companies registered in the Seychelles and bank accounts in Cyprus to hide their personal income and evade tax.
Banyard also pleaded guilty to facilitating the Income Tax fraud by Blakey and King.
During the investigation, HMRC worked with a number of foreign jurisdictions including Germany, Mauritius, Brazil, the Netherlands, France, Cyprus and the United States and found the fraudsters used offshore companies in Mauritius and the Seychelles to cover their tracks.
No shame
Simon York, director of fraud investigation service at HMRC, said: “This was a calculated and cynical crime carried out by men who had no shame in using a worthy cause like HIV research to mask their criminality.
“In doing so, they attempted to steal millions of pounds from the taxpaying public – money that ultimately pays for vital public services like the NHS.
“Promoting tax avoidance schemes is bad enough and we’re making it a priority to go after those who market them, but for these men that was just a first step in establishing an elaborate criminal operation that included offshore accounts, fake transactions and blatant lies.
“To those who would follow in their footsteps, I would say this case sends a clear message that no matter how well you think you’ve covered your tracks, no one is beyond our reach and you will face justice.”
