Taxman used dead man’s identity as part of £171,000 VAT fraud

A former taxman has been jailed for his role in a fraud whichsawmorethan£100,000 in public money paid out in false VAT repayment claims.

EX-VAT inspector James Mcgee, of Troon, South Ayrshire,wasmakingbogusrepayment claims while using the hijacked identity of a dead man to cover up his fraud, HM Revenue and Customs said.

The66-year-oldwasjailedfor 30 months at Ayr Sheriff Court yesterday, HMRC said, after beingfoundguiltyoftwocounts of money laundering and one count of fraud.

In total £101,443.14 was paid out due to the false VAT repayment claims, while a further £70,351waswithheldbyhmrc.

Laurabuchan,procuratorfiscal for specialist casework, said Mcgeeandhisassociates"used their knowledge of the system to steal significant sums and then tried to cover their tracks by laundering the money".

Mark Dryden, 37 of Glasgow, Gary Prentice, 36, also of the city, and Carly Mcginley, 33, of Clydebank,weresentencedearlierthisyearfortheirpartinthe fraud.whenmcgeewasarrested in 2013 he had two bank cards in the name of a dead man. One of the accounts had beenopenedafterthemandied, andtheotherhadbeencredited with some of the fraudulently obtained money.

Mcgee, who left his compliance role with HMRC in 2009, hadhandwrittenpaperrecords at his house which contained detailed information on several VAT registered businesses.

Experts confirmed the handwritten records matched Mcgee's entries in his old HMRC diaries and notebooks.

HMRC said that during interviewmcgeeinsistedhewasnot responsible for any criminality, but he did admit using the hijacked identity when calling its VAT helpline.

Mcgee, who used to work for the HMRC'S Ayr and Paisley offices, said the person whose identity he used was the real controlling mind behind the criminal scheme.

But in reality, HMRC said, Mcgee with the help of others, was central to the fraud.

Mcgee was sentenced to 24 months in jail for VAT fraud and handed a 30 month term for the two money laundering offences. The sentences are to run concurrently.

Dryden admitted to being concerned in an arrangement of criminal property in October last year, HMRC said, and he was sentenced to 10 months in jail in February.