Roderick Bond, 59, a former police officer, and Lee Palmer, 45, a financial market trader, invested in the Formula 1 Projects LLP scheme that involved claiming false tax rebates for a film featuring F1 racing stars which was never made.
Simon Osborne, 58, an independent financial adviser from Llantwit Manor in Wales was also part of the scam. He was jailed for his part in introducing Simon Hill, 50, a former Wales international rugby union player, to the scheme.
Claiming losses
Terence Potter, 58, a disgraced former accountant who is currently serving an eight-year jail term, created the illegal scheme for wealthy investors with the four defendants.
The scheme saw investors claim significant financial losses on the £6m they claimed to have spent between March 2008 and May 2009.
These artificial losses enabled the investors to falsely claim around £40,000 in tax relief for every £20,000 they had invested.
HMRC investigation
HMRC identified a series of suspicious tax repayment claims, which had originated from partnerships set up and managed by Monaco-based accountant Potter.
The majority of the tax refunds were withheld and £210,000 that had been paid out has since been recouped by HMRC.
Simon York, director of fraud investigation at HMRC, said the prison sentences showed nobody was beyond HMRC’s reach.
“These men tried to cheat the system by claiming tax relief on a non-existent film and were thwarted by HMRC investigators who work tirelessly to stamp out fraudulent activity,” he said.
60 officer operation
Potter conspired with Palmer and Bond to steal the tax cash along with financial adviser Osborne.
Osborne introduced Hill, who now works as a dentist, to the partnership and Hill also submitted fraudulent tax repayment claims to HMRC.
The members had to show they were working at least 10 hours a week in the business. The claims were supported by individual diaries running to hundreds of pages produced by Potter and sent in to HMRC by Bond, Hill and Palmer to substantiate their tax rebate claims.
More than 60 officers from HMRC’s Fraud Investigation Service took part in the operation that led to the arrests in August 2014. Nine properties were searched and computers, business records and mobile phones were seized.
Details of the sentences the defendants received can be found on page 2.
