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Pharmacy Owner Jailed for Health Service and VAT Fraud

4 November 2016

 

Aberdeen pharmacist jailed for health service fraud and VAT fraud amounting to £200k 

An Aberdeen based pharmacist, who pled guilty to charges of fraud involving NHS prescriptions and evading VAT was today sentenced at Aberdeen Sheriff Court to 20 months in prison.

Conrad Chau, 50, from Aberdeen, a self-employed pharmacist with premises in Holburn Street, Aberdeen was the subject of an investigation, involving NHSScotland Counter Fraud Services (CFS), HM Revenue and Customs (HMRC) and Police Scotland.

Chau falsified GP10 prescription forms, which he sent to pharmaceutical companies to order quantity controlled medicines at the discounted prices negotiated by the NHS for the treatment of patients in Scotland. It is alleged that he then sold the medicines on, wholesale, for profit.

The suspected fraud came to light when a comparison was made between the genuine prescriptions issued by local GP’s and received by the NHS, and the forged versions of the same documents, which had been sent to the pharmaceutical companies. A search of Chau’s business premises resulted in the seizure by Police Scotland of laptops, hard drives and paper documents, which were passed to CFS for analysis.

When reviewing the seized documentation, CFS was also suspicious of Chau attempting to evade Value Added Tax. It appeared he had altered invoices from Scottish wholesale companies, to whom he had sold items, to make them appear as though they were based in the Middle East and Asia. HMRC were contacted and their investigation revealed Chau had falsified invoices and lied on VAT returns to evade VAT of £214,790. Chau pleaded guilty to the VAT fraud offences on 7 October 2016.

When interviewed by CFS, Chau admitted to his sole involvement in both the forgery of prescriptions and sending them to the pharmaceutical companies.

Gordon Young, Head of CFS, said “Conrad Chau’s actions could have delayed the provision of medicines to patients in need, due to the control measures in place. Engaging in criminality to wholesale medicines erodes the trust between community pharmacists, GPs,pharmaceutical companies, patients and NHSScotland. Counter Fraud Services will continue to work in partnership with all health boards and law enforcement partners in Scotland to prevent, deter and detect fraud and will pursue fraudsters whenever they are identified.”

 Cheryl Burr, Assistant Director, Fraud Investigation Service, HMRC, said:

“Conrad Chau had traded legitimately as a pharmacist, but financial greed led him to commit VAT fraud. Our message is clear - it is simply not acceptable to steal from the tax system and, ultimately, from honest UK taxpayers and businesses.

“HMRC will continue to work closely with our partner agencies to pursue those criminals who attack the tax system. We ask anyone with information about suspected VAT fraud to contact our 24-hour Hotline on 0800 59 5000.”