The director of an engineering company has been found guilty of defrauding a government innovation scheme out of hundreds of thousands of pounds via false invoices and ‘ghost workers’.

Andrew Rendell-Read, 61 of Weston Hills, Spalding, a co-director of VBC Instrument Engineering Limited based in Wellingborough, was found guilty of fraud following a trial at Lincoln Crown Court.  His wife and fellow director, Catherine McGregor, 60 also of Weston Hills, Spalding, previously pleaded guilty to her role in the fraud.

Between September 2015 and August 2018, Rendell-Read and McGregor submitted fraudulent quarterly funding claims to Innovate UK — a Government agency which provides funding to businesses engaged in research and development - in connection with a project to design and manufacture a welding machine to automate the repair of aeroplane turbine blades.

To maximise the payments they received, the pair systematically inflated their costs by submitting false invoices and fabricating two fictitious employees — so-called "ghost workers" — whose ‘wages’ were ultimately funnelled back into the couple's joint bank account. They also overstated the extent to which genuine VBC workers were working on the project in order to exaggerate costs.

Over the life of the project, Innovate UK paid VBC a total of £809,286. The prosecution case showed that the entire amount was fraudulently obtained,  as the first and all subsequent claims against the grant were false. Whilst a prototype robotic welding machine was developed, it was substandard, with most grant funds being used to prop up a failing business. Approximately £260,000 was funnelled directly from VBC into Rendell-Read and McGregor’s personal accounts.

The fraud came to light after a whistleblower reported concerns to Innovate UK.  The company later went into liquidation. 

Philip Slough from the Crown Prosecution Service said:  "Andrew Rendell-Read and Catherine MgGregor persuaded a government body to hand over funds to a failing business, which was meant for legitimate research.  They proceeded to siphon off large amounts of cash from the business into their own pockets. 

“Rendell-Read tried to paint himself as the ‘welding guy’ who was not really involved in the running of the business, but the prosecution proved that this was far from the truth.

"Government grants such as these exist to support legitimate businesses doing real work of benefit to taxpayers and wider society. This conviction sends a clear message that fraud of this kind will be thoroughly investigated and prosecuted."