A former Finance Director at a hospital supplies company has been jailed after ECU found he siphoned off £2.7-million from its accounts − and spent £500,000 of the money on luxury fountain pens.
Ashif Zackaria was employed as finance chief at Coventry based Abena UK Ltd but was suspended in 2015 after a new MD uncovered some suspicious transactions.
Our Economic Crime Unit discovered from 2009 to 2015 Zackaria used business cheques to buy at least 180 luxury fountain pens from high-end makers like Mont Blanc and Philippe Patak.
He made out more cheques to pay off his credit cards, signed off cheques totaling £222,000 to family members, and wrote others for £219,000 to a Northampton-based firm run by a friend with no clear business links to his employer.
ECU also discovered cheques topping one million pounds had been passed to an office supplies firm run by associate Dean Powell.
However, our finance investigators pawed through thousands of documents and could find no evidence of equipment to justify a seven-figure spend and very few invoices.
It was suspected Powell was hugely overcharging for readily available printers and ink − and 52-year-old Zackaria would later admit hatching a plot to split the profits 50-50 behind the backs of fellow directors.
Police raided Zacakria’s home in Milby Drive, Nuneaton, in 2015 and found a stash of luxury fountain pens − plus emails from Mont Blanc confirming the purchases − and designer watches.
He initially refused to answer our questions but in the face of compelling evidence later admitted several charges of employee theft and one count of VAT fraud.
Powell, aged 53 from Batsford in Gloucestershire, also admitted money laundering.
At Birmingham Crown Court on 4 June Zackaria was jailed for three years years while Powell was given a suspended two year sentence, 200 hours unpaid work requirement and pay court costs.
Investigating officer DC Peter Christie from our Economic Crime Unit, said: “This was a vast and complex financial investigation: we had to analyse nearly 17,000 pages of evidence and over 14,000 cheque stubs and understand where each of the cheques ended up.
“We uncovered theft and fraud on a huge scale that had been going on for at least six years.
“Abena calculated the total loss over the course of his employment in stolen funds, HMRC fines and investigation costs approached £4.4-million.
“Zackaria has repaid £2.8 million by selling assets, including property, but we will use Proceeds of Crime Act (POCA) powers to go after any outstanding debt.”
Zackaria made false entries into the company’s accounting system and on VAT returns submitted to HM Revenue and Customs (HMRC) between August 2007 and January 2015, resulting in an estimated VAT loss of £2.1m. He used the VAT fraud and false accounting as a method to steal money from the company’s accounts.
Ian Hackett, Assistant Director, Fraud Investigation Service, HMRC, said: “This was a significant and sustained attack on the public purse. Zackaria pocketed hundreds of thousands of pounds of taxpayers’ money to fund a lavish lifestyle he could not legitimately afford.
“HMRC will not tolerate VAT fraud and we will continue to work closely with our law enforcement partners to pursue the small minority who steal money which should be used to fund our vital public services. We encourage anyone with information about VAT fraud to report it to our fraud hotline on 0800 788 887.”