El Heri, R. v

MR JUSTICE CURTIS: Ahmed El-Heri, date of birth 25th December 1947, is now 57 years he is a Libyan national and came to this country in 1976. He is a man of good character.

Two matters are before us. Firstly, an application in connection with his conviction, for an extension of time in which to ask for leave to appeal against his conviction, following refusal by the Single Judge, on 27th October 2003. At that time the delay was 1 year and 1 month. The second matter before us is an appeal, with the leave of the Single Judge, on 18th July 2002, against the sentence that was passed at the court below. That appeal has been presented to us by Mr Simon Farrell QC.

In order the better to deal with both matters it is necessary to set out the background, since much of it affects both the application and the appeal. The background is therefore as follows. In the seven months before his conviction on 15th February 2002, at Kingston upon Thames Crown Court, before His Honour Judge MacRae and a jury, the applicant stood trial on a count charging him with conspiracy to evade the payment of VAT between August 1998 and July 2000, contrary to the Value Added Tax Act 1994.

His co-conspirators, as the jury found, were one Wim Coene. He was a Belgian national and has not yet been brought to trial. The second co-conspirator was this appellant's son, of no previous convictions, aged about 30. The third conspirator was David Keen, aged 62, with no previous convictions. The fourth, Peter Newman, now 55 years of age, with one previous conviction, for drug importation on 15th February 1994, for which he was sentenced to 18 months. The fifth co-conspirator, Michael Wells, aged 71, had no previous convictions. Sixth and lastly, Stewart Wheeler, 39 years of age, who pleaded guilty to the count we have cited and later gave evidence for the prosecution.

The fraud involved known as a missing trader fraud arose out of the importation of computer chips into the United Kingdom from European Union suppliers in France, Spain and Luxembourg, by phantom importing companies based in the United Kingdom (or in one case, offshore) set up by the conspirators to (a) buy the chips in Europe at the zero rate, as was proper, if it was a genuine purchase, and (b) purport to sell the chips to bogus companies, again set up by the co-conspirators (known as "middlemen") with an elaborate paper chase of purchase and like commercial documents falsely making it appear that the companies on each side were genuine commercial buyers and sellers at arm's length. The middlemen companies would then sell the chips on to bona fide purchasers. In the normal case on a disposition of goods inside the United Kingdom, that would trigger a requirement that VAT be paid and accounted for to the Revenue.

The importing company's part in the fraud was to 'sell' the goods to the middlemen, as described and also receive the proceeds of sale, plus the VAT from the bona fide purchasers. The middlemen did not account the Revenue for the VAT so paid either by making no returns to the Customs and Excise at all, or filing nil returns. After a short life these companies would disappear, hence the slang name for the type of fraud being operated.

On 26th July 2000 Customs and Excise raided, firstly, No. 17 Boltro Road, Hayward's Health, the trading address of various companies with a prefix of the word Launchmart, which were all run by the appellant and, to some extent, his son. The second premises raided were Golf House, Pease Pottage near Horsham, the trading address of Paisley Limited, run by the appellant and his then co-accused, Keen. The third place raided was 72 Sidney Road, Haywards Health, the appellant's home. Other premises were also raided, not material to this hearing.

At trial the Crown were able to show, by documents found in particular and some oral evidence, that the importing companies were Dashwise, run by Wim Coene, Goldleigh Limited, run by Wells and Stephen Wheeler, Citygate Software, run by a man called Ramgolam, who was a front man for the appellant, UK-Euro Trading 2000 Limited, effectively run by Newman, Trustech Systems Limited, run by a man called Bouhafs, who was found not guilty of this offence by the jury, and Computer Parts United Kingdom Limited run by Wells, as the alleged company Secretary.

Secondly, that the middlemen companies were again all the companies with the prefix of Launchmart, run by the appellant; Paisley Limited run by him and Keen, Alfa 7, run by Wells and Newman, Trans-Europe Trading UK Limited run by Stephen Wheeler, the witness we have referred to, Dashwise Limited, run by Coene, Goldleigh Limited, run by Wells and Wheeler, Citygate Software, to whom we have already referred, Twenty-First Century Software run by Bouhafs, to whom we have already referred, Computer Parts UK Limited run by Wells and Newman UK-Euro Trading, run by Watkins as a front man as for Newman and Trusttech Systems Limited, again run by Bouhafs. Also requiring mention is an entity called Magiscam, run by Keen. This was the company or entity which was in charge of the transport of the chips in the United Kingdom and traded under the name we have mentioned.

When the appellant's home at No 17 Boltro Road was searched, documents from five companies, Dashwise, Goldleigh, Twenty-First Century, Paisley and Trustech were discovered. If the trading between those entities and others had been genuine commercial dealing, the documents found would have been in their possession, and not in the appellant's. This evidence cogently supported the Crown's contention that the appellant was involved at a high level in organising this conspiracy.

We are satisfied that the man Wim Coene was the likely originator of the scheme, and the most powerful of the conspirators in the pursuit of the common objective. The jury, however, clearly rejected the appellant's defence that Wim Cohen had duped him into acting as he effectively admitted he did, in the way proved by the Crown. No complaint is made about the summing-up. What is now said by the applicant or his wife is that Wim Coene is also known as Anthony Watkins-Burton. The latter is a man who stood trial in at Bristol in 2002 and was convicted of a similar fraud to the one the subject matter of this application and appeal against sentence, though he was charged with a conspiracy to cheat.

At that time Wim Coene was in a Belgian prison awaiting extradition to the United Kingdom. Anthony Watkins-Burton has been named by various people as associating with a Mr Small of Customs & Excise at the time and other officers of Customs & Excise in an allegedly dubious way.

Contrary to what is believed by the appellant's wife and may be others, we are satisfied that these two men, Wim Coene and Anthony Watkins-Burton are different people, for the simple fact that when Watkins-Burton was on trial at Bristol Crown Court and subsequently serving a sentence of imprisonment in the United Kingdom, Wim Coene was in prison in Belgium, awaiting extradition to this country. It is a matter of fact that he has now been extradited and is in custody in the United Kingdom in a prison here, at the present time.

Further, we are satisfied that there is no evidence that the man with whom the appellant conspired (whatever his name was), has indulged in improper behaviour with any customs officer, or was a participating informant in any way in respect of which his conduct would have affected the safety of this conviction. We agree with the findings of the learned Single Judge, expressed in the reasons he gave on 27th October 2003 to the like effect, as we have concluded for ourselves. Since his adjudication nothing has changed. We have, of course, carefully listened to the appellant's wife and to her concerns and beliefs. There is no evidence justifying our granting the application that she has made in a well presented and calm way, for which we are very grateful.

We have to say also that much time has passed in this case. The arrests were in 2000. Conviction after a 7 month trial in February 2002. The Single Judge adjudication was in October 2003 and here we are in April 2005. It is time for this matter to be brought to a conclusion, in our judgment, and the application for an adjournment for more time is therefore refused.

Turning to deal with sentence, on 11th March 2003 the appellant was sentenced to six-and-a-half years' imprisonment. Also sentenced to the same period was Peter Newman, whose appeal was heard by a different constitution of this Court, presided over by my Lord, the Vice-President, when Newman's appeal against sentence was refused. That took place on 19th June 2003. Newman was involved, as we have set out, in running the bogus companies we have set out earlier in this judgment. The trial judge expressly found that he, Newman, played a like role to that played by the appellant in the conspiracy. The maximum sentence for this offence is 7 years.

We identify the following matters of aggravation in the appellant's case: firstly, loss of revenue due to this fraud is in the order of £8 million. Mr Simon Farrell QC has made a last ditch and valiant effort to tempt us to allot the various amounts to the various bogus companies which were the vehicles used in this fraud. We decline to go down that route. The fraud was charged as one conspiracy charge and each conspirator must answer for the whole fraud and loss of Revenue. Secondly, the complexity of the fraud and the fabrication by the conspirators of many thousands of purchase notes, invoices, receipts and electronic messages, which show, in our view, that this fraud was both elaborate, sophisticated and highly criminal. Thirdly, that the appellant involved his son in the fraud. As a result, the appellant's son was sentenced to three-and-a-half years' imprisonment. We note that his applications for leave to appeal against conviction and sentence were refused on 27th October 2003. The third matter of aggravation did not, of course, figure in Newman's case.

We turn to identify matters of mitigation. Firstly, it is submitted that this was not the worst conceivable fraud, so that the sentence is too close to the maximum. Secondly, no previous conviction. That, as is clear from what we have said, is in contradistinction to Newman who had got a serious previous conviction as stated. Thirdly, Mr Simon Farrell QC submits that Newman is to be distinguished from El-Heri, not only because of the matter of Newman's previous conviction, but because that Newman's group of companies evaded more VAT than the appellant's companies. Even if that were correct, that loses sight of the fact that, as we have said, there is one conspiracy and not two.

We have, of course, borne in mind in reaching our adjudication the case of R v Dosanjh [1999] 1 Cr App R 107 and addressed our mind to the guidance given in that particular case. In our view, the trial judge was perfectly entitled, after a 7 month trial, when he had heard all the evidence, to say that it was not right to distinguish between Newman and this appellant. He, having seen them, could weigh up the extent of their criminality and responsibility for this fraud, which involves, on any view, whether it is £6 million or £2 million, very large sums of money and a very large fraud on the revenue.

Like the other division of this Court, who had to deal with Newman's appeal, we think that the sentence imposed was at the top of the bracket. But this sentence is not manifestly excessive. Therefore, it follows that this appeal is dismissed.