CAB freezes €21m in fraud case

The Criminal Assets Bureau has frozen several Irish bank accounts with funds of over €21m in the midst of an on-going investigation by Irish and British customs officials.

The CAB has been working with customs officers in Britain and Ireland and garda fraud bureau members to investigate a multi-million euro “carousel” fraud involving computer parts which originated in the US and the Far East.

The complex scam involves the movement of computer programming units between two European Union countries to avoid paying VAT. The CAB believes the accounts - two of which are in company names - are controlled by a 29-year-old company director from Ennis, Co Clare, who was arrested yesterday in Britain.

He will be brought before a British court today to face fraud charges.

One of the frozen bank accounts holds €10 million. The majority of the frozen accounts are in the arrested man’s name. Two of the frozen accounts were in a company name.

Computer parts, worth an estimated €500,000, were seized in garda raids in Dublin, Clare and Limerick yesterday.

Earlier this year, Irish custom officials joined British counterparts in an investigation into an alleged €60 million VAT fraud involving companies in Limerick and Clare.

Scam companies had been moving products from Britain to Ireland - repacking them and sending them back - and then claiming millions in VAT.

The British customs division had put a sizeable force of officers into the early investigation.

To date, suspects have been questioned by British police at more than 25 addresses in the British Midlands, northern and south-east England. Revenue sources estimate Britain is losing €5 million a day because of “carousel” fraud.

The swindles, which have involved mobile telephones and computer parts, rely on the European single market. No VAT is charged between EU countries, and mobile phones are ideal for trafficking because they are in high demand and easy to transport.

Fraudsters use front companies to import the phones VAT-free within the EU and then sell them to other traders in Britain charging VAT at 17.5%. The fraudsters pocket the VAT money and disappear.