Preston tax fraudster loses £90 million property empire

A man from Preston - the mastermind of one of the UK’s biggest ever carousel tax frauds - has been ordered to pay back more than £90 million.

Sock manufacturer Arif Patel, 57, formerly of Sharoe Green Lane, Fulwood, Preston, but who now lives in Dubai, and his criminal gang tried to steal £97 million through VAT repayment claims on false exports of textiles and mobile phones.

They also imported and sold counterfeit clothes that would have been worth at least £50 million, had they been genuine.

The proceeds of the crimes funded a property empire, including commercial and residential premises in Preston and London, purchased through offshore bank accounts and companies. He also owned property in Morocco, the United Arab Emirates, Saudi Arabia and Turkey.

Now a judge at Chester Crown Court has ruled that more than £90 million of his restrained property assets should be sold – with the money returned to fund UK public services. Arif Patel’s Ferrari 575 Superamerica has also been restrained and will be sold at auction.

Patel and his co-accused Mohamed Jaffar Ali, 61, of Dubai, were found guilty in their absence of fraud and money laundering offences following a 14-week trial in 2023.

The convictions followed a joint investigation between HM Revenue and Customs (HMRC) and Lancashire Police, which also secured jail sentences totalling more than 116 years for 24 other gang members.

Richard Las, Director, Fraud Investigation Service, HMRC, said:

“Arif Patel lived a lavish lifestyle at the expense of the law-abiding majority, but he will now lose the property empire he amassed from the proceeds of crime.

“Our work never stops at conviction. For the last two years we’ve worked with police and CPS partners to secure one of the biggest criminal confiscations we’ve ever recovered.

“Tens of millions of pounds of stolen money will now go back to directly fund public services.”    

Mark Winstanley, Assistant Chief Constable, Lancashire Constabulary, said:

“Arif Patel was the head of a Preston-based Organised Crime Group responsible for causing millions of pounds worth of losses to multiple companies.

“His actions, motivated by greed directly impacted on the taxpayer. A multi-agency operation involving Lancashire police and HMRC has worked tirelessly to bring confiscation proceedings to this point. The Confiscation Order granted for £90 million will ensure funds are returned to the public purse thereby recovering his criminal gains.

“Mohammed Jaffar Ali was Arif Patel’s trusted financial enabler in Dubai and he too has been made subject to a Confiscation Order for £677,000.

“Lancashire Police are committed to ensuring that crime doesn’t pay and will pursue every avenue to recover monies and assets from those that seek to exploit others for their own gain.”

Adrian Foster, Chief Crown Prosecutor of the Crown Prosecution Service Proceeds of Crime Division, said:

“The CPS has worked robustly with HMRC and Lancashire Police to ensure that Arif Patel could not keep the benefit from his fake counterfeit designer clothes scam and fraudulent VAT claims.

“In total he must pay back £90 million or have more prison time added to his original sentence.

“In the last five years, £478 million has been recovered from CPS obtained Confiscation Orders, ensuring that thousands of convicted criminals cannot profit from their offending. More than £95 million of that amount has been returned to victims of crime, by way of compensation.”

Arif Patel’s Preston-based company, Faisaltex Ltd, was the heart of his criminal empire. From here, he ran the counterfeit clothing import operation and false export business.

As well as being a major player in the overall criminal conspiracy, Mohamed Jaffar Ali also laundered the proceeds through offshore bank accounts.

Arif Patel travelled to Dubai in July 2011 and failed to return. He was tried in his absence at Chester Crown Court where he was found guilty of all charges in April 2023.

Mohamed Jaffar Ali was found guilty of conspiracy to cheat the public revenue and money laundering. He has also received a £677,000 confiscation order since his conviction.

They were sentenced in absence to a total of 31 years in prison.