Finance boss jailed for BTL scam
A former finance boss has been jailed after blowing cash on classic cars and mortgage payments for buy-to-let properties
Section: Features
A former finance boss has been jailed after blowing cash on classic cars and mortgage payments for buy-to-let properties.
John Warne, a former finance team leader at Edinburgh City Council, embezzled more than £122,000 between July 2008 and May 2010.
Warne, 55, was caught as a result of a police probe into VAT-related fraud in Edinburgh City Council’s housing repairs system.
Before 1998, the Council had mistakenly charged VAT on repair bills for homeowners and Senior Manager Warne was part of a team set up to recoup cash from HMRC and return it to the owners.
A court heard how Warne, of Longniddry, East Lothian, plundered £122,925 for his own benefit between July 2008 and May 2010.
The former team leader in the finance section, who had taken early retirement before his offences were uncovered, also spent cash on house improvements and holidays for relatives. He had to sell his family home to help repay the money.
Warne, who admitted the charge, was sentenced at Edinburgh Sheriff Court on Friday.
Sheriff Frank Crowe said: “A breach of trust of this magnitude can, in my view, only be met by a prison sentence.”
Sheriff Crowe, speaking at the Edinburgh Sheriff Court, added: “I was told by the Procurator Fiscal Depute that some time ago Glasgow City Council won a landmark case against H M Revenue and Customs when the court held that payments incurred in carrying out statutory repairs on buildings where exempt from Value Added Tax.
“In the wake of that ruling the City of Edinburgh Council set up a team of which you were part to trawl through past accounts to reclaim VAT from HMRC. During a period between July 2008 and May 2010 you diverted some of the receipts received from HMRC to your own benefit. In particular you indulged in a hobby with classic cars, carried out improvements to the driveway and garden of your home, made mortgage payments on buy to let properties which you had previously acquired and paid for lengthy holidays for your relatives.
“Remarkably these diversions of funds to payees who were not entitled to these sums did not come to light until sometime after you had taken early retirement from the Council. I note that since proceedings have been raised you have made full repayment of the amount embezzled and this has involved selling the home in which you live with your wife.”
Sheriff Crow added: “As a result of an early plea of guilt a typical jail sentence was reduced to 12 months imprisonment from today.”
Edinburgh’s statutory notice system, which involved the council appointing external contractors to repair properties, had already been at the centre of a corruption probe.
An investigation of the property conservation and property care departments uncovered conflicts of interest, gifts to staff and work carried out cheaply on council officials’ homes.
More than a dozen staff were suspended or sacked and police charged a number of people.
Keywords: Edinburgh council, finance boss, embezzlement, jail, fraud, classic cars, mortgage payments, buy-to-let properties, John Warne, VAT, HMRC, repair bills
Source: BTL Insider — https://btlinsider.co.uk/finance-boss-jailed-for-btl-scam