UK Manufacturing output slumps 4.9% year on year - Trade gap widens in October - MITC fraud still an unknown quantity

The seasonally adjusted volume index for the output of the production industries fell by an astonishing and unprecedented 1.8 % cent compared with the previous three months. (Base 2003 =100) Output has fallen for 8 straight months even though the pound has continually weakened and has fallen 4.9% year-on-year .

Between September and October output of UK manufacturing industries fell by 1.4 %. There were widespread falls in manufacturing the most significant decreases in output were 3.6 % in the paper,printing and publishing industries, 4.2 % in the basic metals and metal products industries and 2.8 % in the transport equipment industries - last week figures for new car sales in November were 37% down on a year ago.

The chemicals and man-made fibres industries grew by 1.6% .

Mining and quarrying output decreased by 0.7 % and output of the electricity, gas and water supply industries decreased by 0.5 % compared with the previous three months.

In the last 3 months , output of the consumer durable goods industries fell by 3.6 % compared with the previous three months and was 8.1 % lower than the same period a year ago.




In the last 3 months, output of the capital goods industries fell by 2.7 % compared with the previous three months and was 4.4 % lower than the same period a year ago.


Following this news the pound fell against the euro and the dollar dropping by over 1% to US $1.4742. The euro rose to 87.25p, near its recent record high of 87.38p.


The goods trade gap with the rest of the world widened slightly to £7.8bn in October, (£7.4 billion in September) mainly due to a drop in oil exports because of North Sea production problems. The balance on trade in oil was in deficit by £0.4 billion, compared with a surplus of less than £0.1 billion in September.

In October, total exports of goods fell by 3.5% to £21.2 billion and total imports of goods fell by 1% to £28.9 billion.

The ONS add this cautionary note without further explanation - Changes in trade associated with VAT MTIC (carousel) fraud mean that comparisons of volume and prices (both including and excluding trade associated with VAT MTIC fraud) should be treated with a great deal of
caution. (ie : we haven't a **** clue what the level of fraud is, where it happens and .. well ... er.. that's it)

The UK's surplus on trade in services was £3.9 billion, unchanged from September and in the last 3 months , the surplus on trade in services was £11.7 billion, compared with £10.9 billion in the previous three months. (Exports £40.3 Bn. - Imports £28.6 Bn. )

Whoop di dooo!

UK Trade for 2007 - Exports down 10% - Imports up , Carousel VAT fraud stopped rising as well

Stop Press : The Official Champagne trade body CIVC report that Britain imported 39 million bottles of Champagne last year - more than Spain, Japan and the United States put together - rising by 5.9 % last year.

UK Regional Trade in Goods have been released today ;

EXPORTS

Total value of UK exports for the 12 months to Dec 2007 was £219 Bn and fell by £ 24 Bn (10%)
UK exports to the EU decreased by £25,595m (17 %) in the same period. Northern Ireland was the only country of the UK that had an increase.

UK exports to countries outside the EU increased by £693m (1%).

IMPORTS

The total value of UK imports for the 12 months to Dec 2007 was £308.6 Bn. and rose by £ 6 Bn. (2%)

UK Imports from the EU increased by £4 Bn. (2.5 %) in the same period.

UK Imports from countries outside the EU increased by £2.6 Bn (2 %).

Trade Gap/Deficit = a Record £88 Bn. it was £55.8Bn in 2006 and £44.6 Bn in 2005

NB : Comparison of Exports and Imports between 2006 and 2007 are affected by changes in trade associated with VAT carousel fraud (MTIC) and by EU enlargement in January 2007

Sandra Tudor of the Trade in Goods Branch Statistics and Analysis of Trade Unit Balance Of Payments Division Knowledge, Analysis and Intelligence in a document accompanying the Trade Statistics released today says that the impact on the trade statistics associated with Missing Trader Intra-Community VAT fraud is currently growing again – estimated at over £8 billion in Q1 2006 (13 billion euros or 14 billion US dollars).

Substantial adjustments (now up to £8 billion in a quarter) are being made to the trade figures to account for missing trade declarations associated with MTIC fraud.

She says in the same document ..."It is essential that it is made clear that the estimates are of missing trade declarations associated with carousel fraud, NOT of the fraud itself. The level of tax at risk is substantially lower. On a simplistic basis the level of tax at risk is 17.5% of the trade (the UK VAT rate). However, this will overestimate the level of VAT loss and we have explained to the Press that the estimate of the impact of MTIC fraud on trade should not be used in this way."

If adjustments are being made of £8Bn of trade transactions in 1 Quarter are being made then at a generous 10% = $800 Mn. of VAT per Qtr = £3.2 Bn. a year is still going missing in VAT payments.

Sandra Tudor explains how Carousel Fraud works ...



More posts on Carousel Fraud here and also "Lord Houghton" , law lecturer, lay preacher in £51 Mn VAT carousel fraud jailed for 61/2 years - 8 Mr Bigs free due to botched investigation by HMRC 29-11-2007 and ...Another fucking thieving VAT carousel fraudster locked up - Harjit Singh Takkar, he stole £4.5 Mn. in 3 months from taxpayer. 28-9-2007 also Raymond John Cox , Big fish caught in Carousel fraud (MITC) and £85 Million of taxpayers money which has gone AWOL 12-6-2007 also Massive Europe wide raids to tackle huge VAT fraud 12-12-2006 and how most of them used a certain bank ...VAT scams used Bermuda based Transworld Payment Solutions to move money 11-22-2006

Pic of lady called Stacy Haber-Hofberg, DOB 25/01/62 a former environmental judge in New York , who had moved to Liphook, Hampshire with her English husband and their three young children , received six years in September 2005 along with 3 others for her part (total 22 years in jail) in a £40Mn. VAT fraud. In passing sentence, Her Honour Judge Williams said, "It was an audacious and outrageous fraud... all defendants showed a shameless dishonesty."The highly organised scam, operated over 2 years, involved buying mobile phones from twelve fictitious companies (they were clones of legitimate UK firms, set up in Hong Kong with names and letter-heads identical to British firms dealing legitimately in telephones and computer chips) and using false receipts to charge VAT on the transactions, resulting in a loss to HM Revenue & Customs of more than £40 million.

Raymond John Cox , Big fish caught in Carousel fraud (MITC) and £85 Million of taxpayers money which has gone AWOL

HM Revenue & Customs (HMRC), have finally banged up 6 serious VAT fraudsters (1 acquitted) at Liverpool Crown Court today after a 5 year enquiry. £85 million was stolen from the tax payer in only 19 months (= VAT on sales of approx £600Mn) - 98 businesses based in the UK, Germany, Belgium, Spain and the Netherlands were involved and the 6 jailed men were directors and executives of seven of the companies identified during the trial.

Raymond John Cox (dob14/04/70) from Staffordshire, Cox had two companies in Germany - Signal Telecom GmbH and Crystal Telekom GmbH. He also had control of two companies in Spain - Zeption Telecom SL and Nauti-Parts SL and was the director of Cortage Investments Ltd based in Stoke-on-Trent. The trader which Cox predominately used was Powertone BV, in Holland, a company run by Issitt, McNeill and Sweeney.(Photographs of Cox's house and performance car collection available on request to HMRC)

Brett Simon Issitt (dob 13/12/74) 3 Manor Close, Todmorden, Lancashire. Sentenced to 10 years for his part and disqualified as a company director for 10 years.

Michael Henry McNeill (dob 30/04/71) Rossendale, Lancashire. He was sentenced to 7.5 years for his part and disqualified as a director for 8 years. McNeill, was responsible for the setting up of a template for carousel fraud entitled 'The Bible according to Mike @ Powertone' discovered during the HMRC investigation.

Paul Brian Sweeney (dob 28/11/70) resident at some time in Amsterdam, sentenced to 7.5 years for the fraud and disqualified as a director for 8 years.

Issitt and McNeill were sales executives in and Sweeney was the director of Powertone BV. This is the Dutch registered company based in Amsterdam but with the use of offices rented by Issitt in Manchester. Between April / September 2001 Powertone's turnover amounted to £49.5 million. Although Powertone was based in Amsterdam, its entire mobile phone trade was conducted from an office in John Dalton Street, Manchester.

Peter Kevin Glover (dob 21/04/55) 29 Furze Hill Road, Shipston on Stour, Warwickshire. Sentenced to 5 years for his part and disqualified as a director for 5 years. Glover was the director of Cellphone Europe BV, a company based in Brussels, Belgium, its entire mobile phone trade was conducted from Whitley Bay. Cellphone Europe 'bought' all their phones (with a few exceptions) from Powertone and then supplied the phones exclusively to missing traders in the UK. From October 2001/March 2002, Cellphone Europe sold into the UK over £81 million worth of mobile telephones. At the time of his arrest Glover was in the process of registering Cellphone Europe for Belgian VAT.


Colin Daniel Jones (dob 04/12/65) Wilmslow, Cheshire. He was jailed for 5 years for his part in the fraud and disqualified as a director for 5 years. Jones was responsible for the running of Datacell Ltd. registered in the Republic of Ireland an address in Gorey, County Wexford, Irelandand therefore was an EU supplier into the UK. Its entire mobile phone trade was conducted from an office above a shop in Northenden Road, Sale, Manchester. Prior to Glover's arrest, Datacell had made 13 purchases of mobile phones from Powertone to the value of £4.6 million. In the next four months in 117 Invoices the company purchased £38Mn.
Mobile telephones were purportedly imported into the UK, (and hence VAT free) by various companies set up by the fraudsters, who then sold the phones on, charging VAT that was then never paid over to HMRC - these companies then simply disappeared. The telephones were then 'sold' down the line to various 'buffer' traders before they were exported again often to be repurchased by the original companies at a trading loss. As the accomplices got more confident the transactions grew in number and value and it was clear from handwritten records found that those involved had difficulty themselves keeping a track of the transactions as the scale escalated.

In sentencing, the Judge said, "I am satisfied there was a hierarchy with Cox at the top. From his involvement throughout, and that all his companies were involved. He had all the trappings of wealth. The fact that the phones returned to Cox's companies in my opinion is no coincidence."

The case against a seventh defendant, Sarah Louise Smith, aged 34 from Wilmslow, Cheshire, was left on file following the failure of the jury to reach a verdict in her case. Smith is the partner of Jones and was involved in the running of Jones's company.

Proceedings can now start to confiscate the assets of those convicted.

According to the National Statistical Office Missing Trader Fraud (MTIC) or carousel fraud continues at the rate of £400Mn per months and in the whole of Europe probably exceeds Euros 4Bn.

The House of Lords recently published a report about the problem and said

Forward (inter alia)

"We conclude that existing measures to tackle Missing Trader Fraud do not prevent its occurrence and are unsustainable."

Conclusions. Para 80. It is generally accepted that the broad phenomenon of MTIC fraud is out of control; we expect it to continue to mutate into other sectors.

Pics are of Lord Patel's staff who have recently caught some big fish.

£250 Million pounds stolen from UK Treasury

The stunning scale of theft from the Treasury by VAT fraud was underlined in July 2003, when 350 officers raided 93 premises across the UK and Spain, and made 42 arrests.

Today Customs officers made 10 arrests nationwide (In addition, European arrest warrants have been issued in France and Spain against four individuals. ) after 5 years investigating a suspected £250 million VAT missing trader fraud.

More than 500,0000 documents , 361 hard drives have been systematically examined, along with the hard drives of 391 computers

Those arrested are alleged to be the operators a sophisticated network of companies that 'carouselled' large quantities of mobile phones, buying them VAT-free from the continent to supply to businesses in the UK, and then defaulting without paying the VAT due.

Those arrested are

* Curtis Laurent (dob 30.9.58) 56 Ty Draw Rd, Roath Park, Cardiff, CF23 5HD.
* Marcus Hughes (8.9.70) HMP Dovegate, Uttoxeter, ST14 8XR.
* Keith Bennett (4.8.61) Beechwood House, 14 Brownswood Rd, Beaconsfield,
HP9 2NU.
* Hashib Apabhai (20.4.60) 1 The Gatehouse, Gatehouse Lane, Bedworth, CV12 8UE.
* Mohammed Novsarka (15.3.61) 216a Coventry Rd, Warwickshire, CV7 9BH.
* Peter Ebbrell (13.5.51) 3 Abberton Way, Coventry, CV4 7HF.
* Keith Ponder (20.11.50) Furzefield House, 3 Furzefield Road, Beaconsfield,
HP9 1PQ.
* Amir Naghibossadat (6.9.70) Flat 43 Clarendon Court, 33 Maida Vale, London
W9 1AJ.
* Sampson Goldstone (17.4.75) 2 West Lynn, Devisdale Rd, Bowdon, Cheshire.

Apabhai, Novsarka and Goldstone have been charged with money
laundering offences.

Goldstone was arrested at Heathrow Airport yesterday evening, Monday 5 February 2007 and subsequently charged. He has property and spends a lot of time in Monaco.

A 10th man and a 37 year-old woman were arrested late this afternoon

These arrests relate to frauds allegedly perpetrated up to July 2003 - best estimates are that it continues at the rate of £400MN a month, every month throughout 2006 AT LEAST. Recovery of thewse vast amounts of cash is negligible - it is used further to fund drugs, human trafficking, fraud, terrorism, gun running, diamond and tobacco smuggling.

Hashib Apabhai has cropped up trading as Kings Chambers from his luxury house on a gated estate as a lawyer but is unknown to Law Society and the Bar Council. The DTI tried to close down 2 property companies he was involved with Sterling Mansion (UK) and SMI Overseas who had employees who then went on to work for Properties of Distinction and Turningpoint who in turn were connected to CM2 (commenced trading Jan 2003) , all trading from the same address in Peterborough which fleeced "investors" in 2003.

Curtis Laurent was disqualified as a Director for 11 years from 26/05/2006 relating to his activities as a Director of Sava Ltd Co No 04204698 UNIT 12 MAESGLAS INDUSTRIAL ESTATE NEWPORT who closed with a Creditors Voluntary Liquidation of £6,273,791.00.

It appears Mr Laurent from 20/1/04 to 3/4/04 ( that's 6 fucking weeks !) , allowed Sava Ltd.,to Purchase goods worth, at least, £23,331,538, with no VAT payable, from suppliers based in Portugal and Luxembourg . Selling these goods for the sum of £27,585,342 including VAT of at least £4,108,454, to customers in the UK. Making payments of, at least, £7,543,800 to parties other than the supplier of Sava, Mr Laurent disregarded the suspicious circumstances surrounding a number of transactions involving the supply of mobile telephones and computer components, which should have alerted him to the risk that the VAT payable to HM Revenue & Customs & Excise in respect of the supplies would go unpaid. Which resulted in HM Revenue & Customs claiming the amount of £6,170,964 in respect of unpaid VAT and charges.

£6.1 Mn in 6 weeks. Cash in the Bank from HMG.

Dawn Primarolo fiddles whilst the Treasury is looted

Carousel Fraud is massive. Criminals are taking over £400 Mn each month from the Treasury by fraudulent claims - Lord Patel has regularly posted on cases which appear before the courts. In December in the Pre Budget Statement the updated figures for MITC fraud were promised but did not appear (Footnote). This week the Liberal Democrats sought better and further particulars about the criminal elements unvolved the scale of theft and of the efforts to stop this fraud.

In answer to questions about Carousel Fraud by Simon Hughes, gorgeous, pouting, clever, highly educated Dawn Primarolo ( Hansard 18th January Col. 1338W ) did her best not to be helpful. She said approximately 1,000 extra staff were allocated to HM Revenue and Customs as part of the overall VAT Compliance Strategy (VCS) in 2002-03 (5/4 years ago) which included VAT Missing Trade Intra-Community Fraud (MTIC = Carousel Fraud) as one of its priorities.

A total of 1,500 staff are now engaged in countering MTIC fraud across the Department following an additional redeployment of 700 compliance staff since Budget 2006 - (an update was expected by Gordie in the December Budget Statement but nothing was said.)

Simon Hughes also asked that for the last 12 months, how many
1, companies were investigated
2, prosecutions for carousel fraud were started
3, prosecutions for carousel fraud were completed

Dr Vincent Cable asked for each of the last 5 years for which records were available ;

1. How many prosecutions were there for carousel fraud
2. How many of the defendants in cases of carousel fraud were known to be part of organised crime gangs

To which the delightful hard working mum Dawn 52, (pic with friend) replied : "Details of the investigations and prosecutions conducted each year by HM Revenue and Customs are published in the departmental annual report and, prior to the creation of HM Revenue and Customs, was published each year in the annual reports of both the Inland Revenue and HM Customs and Excise. Where the specific information requested is not published, it is not collated in that format" - ie who the gangsters, para militaries are.

On the same day the Asset Recovery Agency acting under the Proceeds of Crime Act in a High Court Action served Property Freezing Orders (PFOs) on individuals and companies connected with and /or controlled by Paul Dermot Craven and Brian Pepper as they held assets which were obtained through the proceeds of unlawful conduct, including money laundering, tax evasion, false accounting, mortgage fraud and benefit fraud.

In this case, which is said to be connected to well known Republicans in Northern Ireland have frozen 77 further properties around Greater Manchester , now making a total of 92 properties valued at £13m which have been seized and investigations continue. The equity value is however much lower (presumably because the properties are mortgaged) and is about £4.7Mn.

"There are people in groups across society who are not engaged in further paramilitary activity - but will engage in organised crime because it funds their lifestyle," says Northern Ireland security minister Paul Goggins. In 2005-6 in England, Wales and Northern Ireland, ARA managed to convert £4.1m in assets into hard, recovered cash. On 11th January 2007, the Home Office laid a Written Ministerial Statement before Parliament setting out Government proposals to merge the Assets Recovery Agency (ARA) with the Serious Organised Crime Agency (SOCA) from next year it will disappear as the ARA and be absorbed into the Serious Organised Crime Agency early in 2008.

The Orders name ; Dermot Craven Developments Ltd, Craven House, Britannia Road, Sale,
Manchester and company directors Brian Pepper of Bridgewater Street, Sale,
Manchester and Dawn Craven;
* Avenue Holdings Ltd, Craven House, Britannia Road, Sale, Manchester, and
company directors Paul Dermot Craven of South Downs Road, Hale, Altrincham,
Cheshire, Brian Pepper and Gerald Joseph Nightingale;
* DC&BP (2004) Ltd, Craven House, Britannia Road, Sale, Manchester, and
company directors Dermot Craven and Brian Pepper.

The Agency has not alleged any criminal conduct by Dawn Craven or Gerald Joseph
Nightingale but has frozen property held by them, or by companies of which they
are directors, because it alleges that the property held is the proceeds of crime.

One is left with the smell that lots of very worthy hard working people are working very hard ... and ...er.. not getting very far ... and Dawn doesn't really want anyone to see how little they have acheived so far. Anyway the ARA will disappear next year so comparisons cannot be made blah. blah..... making itn look like the criminals have got away with approaching £5Bn a year for the last 3 years AT LEAST.

Footnote
"The correct figures will be available in the PBR, as they are every year following the application of the strategy for reducing MTIC fraud."