Construction Industry Insiders Jailed for £22 Million Taxpayer Fraud
What Happened:
Seven individuals linked to a construction company were sentenced on 4th February 2025 for orchestrating a massive £22 million fraud against taxpayers. These individuals set up fake payroll companies to pocket VAT and Construction Industry Scheme (CIS) contributions, instead of passing the money to HMRC. The stolen funds were diverted into their own accounts, resulting in a significant loss to public funds.
The Crown Prosecution Service, working with Kent Police and HMRC, successfully built the case, proving these criminals were responsible for defrauding the government.
The Consequences:
The offenders were sentenced to prison terms ranging from 27 months to nine years and four months. These sentences underscore the severity of their crimes, which included tax evasion, money laundering, and organised criminal activity. This case is a glaring reminder of the serious legal consequences of engaging in fraudulent activities.
How Stonebridge Protects Our Clients:
This case highlights the importance of partnering with compliant and trustworthy companies like Stonebridge. We ensure all relevant CIS deductions are handled correctly, helping our clients stay fully compliant with tax regulations and protecting our contingent workforce. Non-compliance comes with significant risks—including penalties, fraud, and reputational damage—so make sure your business is working with the right trusted partners.
Ignorance Is Not Bliss:
It’s crucial to understand that working with companies involved in fraudulent activities, even indirectly, can have serious repercussions. HMRC can apply the Kittle Principle, which allows them to transfer tax liabilities directly to your business, even if you weren’t actively part of the fraud. "Not knowing" is no excuse, and businesses that engage with non-compliant payroll providers or fraudulent companies could be held liable for unpaid taxes, penalties, and interest—putting both your financial stability and reputation at risk.
If you’re currently working with a provider that’s not fully transparent or compliant, it’s time to act. Don’t wait until it’s too late. Stonebridge guarantees you stay compliant, secure, and free from future complications. Let’s talk and make sure your business is protected.
Don’t risk it—stay compliant, stay protected, and work with Stonebridge.
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