Adobe StockTwo Scottish company directors have been disqualified after importing more than 350,000 vapes disguised as medical equipment.
Border Force officers intercepted a shipment of 352,688 vapes addressed to YSK Enterprises Limited in Harwich, Essex, in 2023, after goods labelled as nebulisers were found to be e-cigarettes.
The company had imported large quantities of vapes from China between February and April 2023, but told HMRC it owed no VAT on the sales and failed to submit any corporation tax returns.
HMRC calculated that the Scots company, directed by Kyle McGinness and Leanne Moynes, owed almost £15m in unpaid VAT and customs duty, and a further £437,101 in corporation tax.
Moynes also failed to preserve the company’s accounting records, despite repeated requests from the liquidator.
As a result, it was not possible for investigators to verify what happened to more than £1.6m of the company’s assets, including land, machinery and vehicles.
McGinness, 24, of Glasgow, was disqualified as a company director for nine years in June this year.
Moynes, 37, of Rutherglen, was also disqualified for nine years, with her ban coming into effect on Thursday, August 13.
Dave Magrath, director of investigation services at the Insolvency Service, said: “Illicit and unregulated vapes are a growing problem on our high streets, putting consumers and legitimate businesses at risk. McGinness and Moynes went to considerable lengths to disguise what they were importing and then compounded that deception by telling HMRC they owed no tax at all.
“This was a deliberate attempt to avoid millions of pounds that should have been paid to the public purse. Director disqualification is one of the tools we use to protect the public and legitimate businesses from those who think they can operate outside the rules.
“By securing these disqualifications, we are making sure McGinness and Moynes cannot put other companies, creditors or consumers at risk in the same way.”
Richard Hopwood, head of Insolvency Profession at HMRC, said: “We are determined to allow honest businesses to thrive, which is why it’s crucial we work closely with the Insolvency Service and other partners to take action against anyone that undermines the tax system.
“The majority pay the tax that is due, but we will work with partners to pursue those who refuse to play by the rules.”
Phillip Holliday, head of Central Region at Border Force, said: “Criminal gangs peddling illegal vapes and tobacco undercut honest businesses and blight our high streets.
“This case highlights the vital role Border Force plays in clamping down on this illicit trade. Through our intelligence-led enforcement action, we are protecting communities, levelling the playing field for business, and disrupting organised crime.”
The disqualifications prevent McGinness and Moynes from managing, forming, or promoting a company without the court’s permission.
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