A COMPANY boss found to have fraudulently evaded £1.2million in VAT has been banned for 12 years.

Investigators from HM Revenue and Customs (HMRC) warned Richard Beech and wholesalers UCS Trading about the potential risks of missing trader in the community style frauds.

This is where the movement of goods within jurisdictions is VAT-free - but the practice is often exploited by criminal elements.

An Insolvency Service probe found Beech and UCS took part in transactions between February and August 2017 which caused the firm to wrongfully claim input VAT of £1,208,667.

Beech, of Urmston Lane, Stretford, can now no longer be a company director until February 2032.

An Insolvency Service report says Beech was reminded of his obligations to conduct due diligence on suppliers. He told HMRC he only contacted one supplier, West Yorkshire Metals, via e-mails and telephone calls.

Beech was advised two trading partners had seen their VAT registrations cancelled in August 2017. But he had continued to trade with one, making claims for input tax on four separate occasions.

Investigators say Beech should have been aware of the risk of fraud when suppliers were willing to deliver large volumes of high-value scrap metal to UCS on credit, despite his lack of industry experience. His main supplier, West Yorkshire Metals, supplied him with scrap worth £4.8million, to be immediately sold on.

The inquiry found UCS charged below London Metals Exchange rates for the scrap, had no insurance, had not inspected the weight or quality of deliveries and did not have the manpower to process the amounts of goods they were said to be processing.

Tax officials say 94 per cent of UCS deals from February to August 2017 were linked to fraudulent VAT losses elsewhere in the supply chain.