Commission probes tax-evasion scam

The Charity Commission is in conversation with the two remaining trustees of a Lancashire charity that was used as a vehicle for a multimillion-pound tax-evasion scam by three former trustees.

Brothers Mubarak, Mustaq and Iqbal Patel resigned as trustees of the Bolton-based Great Lever Muslim Society after being found guilty of a £5.3m tax fraud that involved depositing money made by their family businesses into the charity’s bank account, where it was used for their own purposes.

Each received three-year sentences at Liverpool Crown Court last week for their part in the scam, which involved the family-run Aleef garages and newsagents chain, as well as the society, which was established by the brothers’ father Ahmed Patel in 1991 to advance Islam, promote race relations and advance education and leisure in the Bolton area.

A number of the garages and shops had two tills, but declared the takings from only one of them. The money from the other was paid into accounts under the name of Ahmed Patel and Great Lever Muslim Society, which the family also ran.

The charity’s bank accounts showed that more than £2.5m had been deposited between 1998 and 2002. However, its accounts filed with the Charity Commission for the same period record annual incomes of just less than £10,000. The rest of the money was used to fund the Patel family’s lifestyle.

The three brothers have stood down from the charity’s board, but their father, Ahmed Patel – who was deemed too ill to face charges – and another brother, Ibrahim, are still listed as trustees.

A statement from the commission confirmed that it was in contact with the remaining trustees “to ensure that the charity is administered properly going forward”.

It read: “The commission has monitored the risks to the charity and has been satisfied that its property and other interests have been protected so far as is practicable, balancing these interests with the need for the proper administration of justice.”

In addition to their jail sentences, the three Patel brothers were ordered to pay back the £5m and pay £500,000 costs, and they were banned from being company directors for 10 years. Another five people involved in the fraud were given custodial sentences and a further two were given community service.

Have you registered with us yet?

Register now to enjoy more articles and free email bulletins

Register
Already registered?
Sign in

Before commenting please read our rules for commenting on articles.

If you see a comment you find offensive, you can flag it as inappropriate. In the top right-hand corner of an individual comment, you will see 'flag as inappropriate'. Clicking this prompts us to review the comment. For further information see our rules for commenting on articles.

comments powered by Disqus
Follow us on:
  • Facebook
  • LinkedIn
  • Twitter
  • Google +

Latest Jobs

RSS Feed

Third Sector Insight

Sponsored webcasts, surveys and expert reports from Third Sector partners

Markel

Expert Hub

Insurance advice from Markel

Digital fundraising tips and tricks

Digital fundraising tips and tricks

Partner Content: Presented By Markel

Third Sector Logo

Get our bulletins. Read more articles. Join a growing community of Third Sector professionals

Register now