Investigations ongoing after carbon credits raid
Police are continuing investigations into an alleged £38M VAT fraud relating to the carbon credit market.
Officers and HM Revenue and Customs staff, who arrested four people last week, over the alleged fraud involving the trading of emissions allowances, also called carbon credits.
Firearms and what was described only as a ‘large amounts of cash’ were found during the the raids on seven properties in the London and Leicester areas.
Opportunities for criminals to exploit the VAT situation have appeared since carbon credits became zero rated for VAT purposes from July 30 last year.
These allegations relate to a UK based organisation buying emissions allowances from overseas, often in Europe where it legally does not pay VAT.
However, it then sells the credits on to another UK based, and legitimate company – charging them VAT – but not paying it on to HMRC.
The swoop last week is linked to raids that took place in August last year where nine individuals were arrested.
Assistant director of criminal investigation for HMRC, Chris Martin, said: “All those arrested now and last August are believed to be part of an organised crime group operating a network of companies trading large volumes of high-value carbon credits.
“The fraudulent companies allegedly purchased carbon credits from overseas VAT free sources and then sold them on to businesses in the UK at a VAT inclusive price.
“HMRC investigates all criminal attacks on the tax system, gathering evidence to prevent fraud and enabling prosecutors to bring offenders before the courts.”