A family who ran an umbrella payroll company Central Payroll Specialists, which was later rebranded as Quality Premier Services, have been jailed for a total of 27-and-a-half years for stealing more than £45 million in a UK payroll fraud.

The family’s umbrella company provided payroll services to recruitment firms and issued invoices to their customers with 20% VAT applied. They declared sales amounting to under £20 million when it was more than £250 million and did not pass the VAT they received from the recruitment agencies to HMRC, according to the Mirror. Essex Police and HMRC found that the firm had paid just under £4 million in VAT between September 2012 and 2015 leaving up to £46 million in unpaid VAT.

Police in Essex are now seeking to recover as much money as possible from Geoffrey, Joshua and Andrew Copp, who all ran QPS Services. The family spent the money on luxury cars, houses, watches, race horses and more. They were found guilty of conspiracy to cheat the public revenue and money laundering between February 2012 and December 2015 following a trial at Wood Green Crown Court.

The company’s website claimed that “At QPS we believe that compliance and professionalism should lie at the heart of all business dealings. However the real value of our service comes from our extensive experience in the contracting sector, our forward thinking approach and our flexible attitude to processes and systems”. The company also claimed to have “major national agencies” among its clients. Nevertheless, the company was declared insolvent in November 2015 and Baker Tilly Restructuring and Recovery LLP appointed as liquidators. In the joint liquidators progress report published in December 2016, agencies had provided details of potential preferential liabilities totalling £270,000 on behalf of temporary workers. The only staffing firm mentioned in the progress report was HRGO, a £90 million multi-specialist provider, who was alleged to owe money to QPS though this was subject to a counterclaim.

Michelle Reilly, CEO of 6CATS International, a global contractor compliance consultancy commented on the case and warned recruitment agencies about their suppliers.

“This is an extreme case, yes, but it’s far from being an unusual one and over the past few years we’ve seen an increasing crackdown on firms that operate outside of the law and put the recruitment agencies they work for, and the contractors those agencies place, at serious risk,” Reilly said. “However, there are still many organisations out there under the misguided belief that they can somehow slip under the radar and, while few will be quite as extravagant as this one has been, it’s highly likely that they will be caught out.

“This will not only leave your firm scrabbling around to find a new supplier, but can also leave your contractors and even your agency at risk of a major punishment such as an unlimited fine or potentially a prison sentence. It’s now time for recruitment agencies to take the bull by the horns and take responsibility for ensuring their suppliers are operating compliantly before it’s too late,” Reilly said.