HMRC prosecutions for Carousel Fraud include the common law offence of cheating the revenue offence, or conspiracy to cheat under Section 1(1) of the Criminal Law Act 1977, where the ‘VAT’ evaded in the fraud is often referred to as ‘monies purporting to be VAT’. Indictments may also include offences relating to converting or removing the proceeds of criminal conduct from the jurisdiction of the UK authorities, contrary to the Proceeds of Crime Act 2002 Sections 327–329.
Missing Trader Intra-Community (MTIC) or Carousel Fraud is when a fraudulent business imposes itself through a supply chain trading in high value low bulk goods in order to obtain and disappear with large amounts VAT within the transactions.
The types of goods targeted are electronic items such as mobile phones and electronic products to toiletries.
HMRC investigators will use their resources to locate parties that are involved in carousel fraud. The prosecution will have to show evidence that individuals are linked to various companies involved and that they are guilty of conspiracy to defraud the HMRC and conspired together to make false VAT claims.