Three fraudsters sentenced for scamming the taxpayer out of over £1 million
Three people were sentenced today (20 May 2022) for defrauding the taxpayer of over £1 million in a criminal scheme that exploited government systems designed to support businesses.
Lee Hickinbottom, 49, was sentenced to eight years' imprisonment after being convicted of multiple counts of cheating the public revenue (HMRC and DWP). Tabatha Knott, 34, was sentenced to 18 months' imprisonment suspended for two years after being convicted of one count of cheating the public revenue (HMRC) and one count of money-laundering. David Hickinbottom, 36, was sentenced to 18 months' imprisonment suspended for two years after pleading guilty of one count of cheating the public revenue.
The criminal enterprise involved the defendants using a company’s VAT registration to make fraudulent VAT repayment claims towards the end of its life and after it had gone into liquidation. Businesses who have charged customers prices less VAT than they have paid on purchases can then put claims to the HMRC to repay the difference.
Between September 2013 and November 2014, Serenity Travel Ltd over claimed £43,177 in VAT repayments. Tabatha was the director of this company but was assisted by Lee Hickinbottom.
Once Serenity Travel had gone into liquidation, Lee Hickinbottom VAT registered a company called Serenity Community Transport Ltd, with him named as a director. There is no evidence that this company ever did any legitimate trade, but Lee Hickinbottom used false invoices to support his fraudulent VAT returns. The legitimate companies with whom he purported to have traded were clear they had not traded with Lee Hickinbottom in any capacity. Serenity Community Transport Ltd claimed £1,290,326.93 in VAT (relating to over £7m in fake invoicing).
Money from the fraud was used to buy a café and newsagents in Solihull. Rebranded as “Cornyx Corner”, the businesses quickly failed in the hands of Lee Hickinbottom. Once HMRC had intervened and stopped VAT repayment claims being paid to Serenity Community Transport Ltd, Lee Hickinbottom continued to make false VAT repayment claims of over £50,000 to keep the new businesses afloat.
Taxpayers’ money was spent on Lee Hickinbottom and Knott’s lifestyles: cars, jewellery, £1,500 on Lego, home improvements, investments in other companies, loans, and gifts to family. Although Knott had no formal links to Serenity Community Transport, she benefitted from money being transferred to her from these frauds and the lifestyle Lee Hickinbottom provided for her.
Before the trial Lee Hickinbottom, admitted to cheating the revenue with regards to false claims for Job Seekers’ Allowance and Employment Support Allowance by failing to declare savings and income, during the time the companies were operating. He received £28,520.26 which he was not entitled to receive.
David Hickinbottom had two companies, neither were registered for VAT but he charged his customers VAT totalling £8,322 which he was not entitled to do. He pleaded guilty to this offence of fraud before the trial.
Anamarie Coomansingh of the CPS said: “Taxpayers’ money, which should have been spent on vital public services such as the NHS, education and social care was instead used to fund the unearned and extravagant lifestyle these defendants enjoyed.
“The CPS will be inviting the court to put in place measures to prevent Lee Hickinbottom, a career criminal, from committing similar offences in the future. We will also be pursuing confiscation proceedings against the defendants, to strip them of any money from their criminal activity.”
The CPS is committed to continue to work alongside law enforcement and investigatory authorities to bring fraudsters who target the taxpayer to justice.
Notes to editors
- Ana Coomansingh is the Specialist Prosecutor for the CPS Serious Economic Organised and International Directorate (SEOCID)
- SEOCID was launched on 1 April 2022 and is the CPS response to the changing nature of crime by bringing together specialists in organised and economic crime as the lines in this criminality is being blurred even more
- The CPS Economic Crime Strategy is available on our website
- Lee Hickinbottom (DOB: 2 August 1972) was sentenced to eight years' imprisonment after being found guilty of multiple counts of cheating the public revenue (HMRC and DWP)
- Tabatha Knott (DOB: 5 September 1987) was sentenced to 18 months' imprisonment suspended for two years after being found guilty of one count of cheating the public revenue (HMRC) and one count of money-laundering
- David Hickinbottom (DOB: 28 May 1985) sentenced to 18 months' imprisonment suspended for two years after pleading guilty of one count of cheating the public revenue.