GEMS dealer Darius Guppy and business associate Benedict Marsh
admitted spinning a ''web of deceit'' to claim falsely nearly #200,000
VAT on a large consignment of gold bullion that was later smuggled to
India, a court heard yesterday.
When he was questioned by investigators, 28-year-old Old Etonian Guppy
-- best friend of the Princess of Wales's brother Earl Spencer -- told
them that money had not been the motive.
''The main incentive was adventurousness. It was stupid,'' he
admitted.
Guppy, watched by his pregnant wife, Patricia, whom he had not seen
since being convicted of a separate #1.8m gems insurance swindle 20 days
ago, pleaded guilty at Snaresbrook Crown Court to three charges relating
to the illegal VAT claims between October 1989 and July 1990. Marsh
admitted one of the offences.
Mr Anthony Glass, QC, prosecuting, told the court that the charges
arose from forged export documentation produced to Customs by the two
Oxford graduates to support a false story that they had been exporting
gold to Switzerland.
He said that Guppy was the main organiser of the fraud which came to
light following a routine visit to a Hatton Garden jeweller. Guppy had
been using the dealer's company and books to process the bogus tax
claims, amounting to #197,179.
However, in the event, the pair received just over #122,000, which the
two men had now repaid in full to Customs.
He said that Guppy and Marsh were executive directors of Inca
Gemstones of Bond Street, set up in 1988 under the Business Expansion
Scheme.
''One of the conditions under the scheme was that the company must not
deal in any investment such as gold bullion,'' said Mr Glass.
Mr Glass explained that the gold was bought in this country and the
scheme the men put together centred on the fact that bullion, when
exported, received zero rating status.
To reclaim the VAT they had paid on purchasing it, they forged airway
bills and other documents, some bearing a copied signature of a genuine
Customs officer which had been taken from papers connected with a
legitimate transaction.
In addition, Guppy, of Ladbroke Grove, London, had made up a bogus
Customs stamp to lend authenticity to the scheme, said Mr Glass.
But, he told the court, the two men had not been as clever as they
believed. At least one of the dates used on the false papers and
purportedly bearing the signature of the Customs official happened to
coincide with the officer's holiday.
But behind the picture of gold being sold to Swiss dealers, which the
two men had tried so hard to paint, lay the fact that the precious metal
had been smuggled to dealers in India in false-bottomed packing cases.
''If this export had been conducted in an honest and above-board
fashion, the defendants would have had no difficulty in reclaiming VAT
paid on the gold, and there would have been no necessity for involving
themselves in this web of deceit,'' said Mr Glass.
Mr Glass said that Marsh, of Southwark, London, told Customs
investigators that he only got a ''small amount'' for his part in the
VAT fraud. He could not remember the exact amount.
Mr Glass said that, when questioned about the money he had made, Guppy
added: ''It was thousands, not hundreds of thousands -- probably at the
end of it #100,000.''
Judge Andrew Brooks agreed to adjourn sentencing of the two men until
March 23 after a joint defence application supported by the prosecution.
Marsh's counsel, Mr John Kelsey-Fry, explained that in order to
mitigate properly he needed to know the results of further
investigations.
It is understood that these relate to the whereabouts of up to #4m
which the two men swindled from Lloyd's of London and their own company
following a bogus gems robbery three years ago in a New York hotel.
Investigators are convinced the money has been secreted in the two
men's private Swiss bank accounts.
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