North East businessman put behind bars for cheating the taxman out of £1.7million

Accountant Kenneth Scott operated seven financial services companies across the North East of England under the Sunderland-based Willis Scott group, with offices in South Shields, Hexham, Newcastle and County Durham.

Newcastle Crown Court heard the firms' 27 employees had tax and national insurance deducted from their wages but the money was never passed on to the Inland Revenue.

Clients were charged VAT, despite the group not being registered, which was not handed over to the HMRC.

The court heard during the seven year revenue dodge, Scott went on a series of high-end trips.

These included a £13k holiday in 2016/17, a £23k holiday in 2017/18, a £44k holiday in 2018/19 and he splashed out on a £73k Aston Martin in 2019.

When he was interviewed over the offences in 2021 Scott already had a £5k cruise booked for that year and admitted his spending had been "a bit over the top".

Scott, 69, of Fir Tree, Crook, County Durham, admitted two charges of cheating the revenue out of a total of £1.7m between April 2014 and March 2021.

Judge Edward Bindloss jailed him for four years and banned him from being a company director for ten years.

The court heard because the employees' deductions had not been paid to the Inland Revenue, it meant they were unable to claim benefits after they were no longer in their jobs.

One worker went to Glasgow for six months due to her mother's ill health and was unable to claim any money she would otherwise have been entitled to while she was there.

Their pensions could also be affected.

Prosecutors claim the figure Scott pocketed was nearer £2.1m but no hearing was held to determine the exact amount and proceedings have commenced under the Proceeds of Crime Act in a bid to get the money back.

The court heard almost £500,000 has already been repaid by Scott and he plans to sell assets to settle the rest.

References described Scott, who was in business for 40 years, as "courteous, kind and polite" and others spoke of him being a "good employer" who would help people who needed it.

Gary Darrington, Operational Lead, Fraud Investigation Service, HMRC, said: "As an accountant Kenneth Scott should have known better than to try and cheat the system. He stole from the taxpayer and damaged the tax records of his employees, which we have been working hard to correct.

"Accountants hold a position of enormous trust and this sentence should serve as a warning to the minority of corrupt professionals who wrongly believe they can use their knowledge to commit or facilitate tax crime.

"Anyone with information about suspected tax fraud can report it online."

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