The defendants were involved in setting up bogus payroll companies which pocketed VAT and Construction Industry Scheme (CIS) contributions rather than pass them on to HMRC

Daniel Newton, 38,  Philip Bailey, 36, Sean Dean, 41, Lee Hudson, 56, Sarah Gillard, 41, Bradley Mortimer, 39, and Kevin Ratcliffe, 43, were sentenced to nine years and four months imprisonment, six years and three months imprisonment, seven years imprisonment, five years imprisonment, two years imprisonment suspended, three years and six months imprisonment, and 27 months imprisonment, respectively for cheating the public revenue, money laundering related offences, acquiring criminal property and organised criminal gang activities.

The Crown Prosecution Service worked closely with Kent Police and HMRC to build a case for trial after unpaid VAT and CIS contributions were diverted to the bank accounts of the defendants.

The beneficiaries included the lead conspirators Bailey, Newton and Dean who were responsible for establishing, maintaining, and developing the scam. Ratcliffe was a customer company director who received ‘kickbacks’ in exchange for providing business to the core payroll company.

Hudson was an office worker who was conducting the day-to-day business which enabled these offences. Gillard and Mortimer functioned as cash couriers for money laundering for the illicit activities.

Julius Capon of the Crown Prosecution Service said: “These criminals stole £22m from the taxpayer. Fake payroll companies were created and operated by Bailey, Newton, Hudson, and Dean.

“Construction companies would permit these payroll companies to make VAT and Construction Industry Scheme (CIS) contributions to HMRC on behalf of their subcontractors.

“Instead of the VAT and CIS contributions being paid to HMRC, the defendants pocketed the monies themselves.

“The defendant Ratcliffe owned a construction firm which received cash ‘kickbacks’ for assisting in this illegal enterprise of cheating the revenue. The defendants Gillard (partner of Philip Bailey) and Mortimer laundered the proceeds through their bank accounts.

“The CPS has commenced proceeds of crime proceedings against the defendants to claw back the money they made from this illegal scheme.”

Ian Hackett, Operational Lead, in HMRC’s Fraud Investigation Service, said: “We have worked closely with Kent Police to dismantle this sophisticated and complex fraud.

“The tenacity and expertise of the investigators involved in this joint investigation has protected millions of pounds of taxpayers’ money, which is needed to fund our public services.”