HS2 Ltd have reported one of their subcontractors to HMRC over alleged fraud involving pay for construction staff
The HS2 subcontractor fraud case will now be looked into by HMRC following HS2 Ltd’s own investigations into two of its contractors.
The case in question involves a firm that was supplying workers to Balfour Beatty Vinci, one of the HS2 contractors.
The case will be raised in Parliament
Heidi Alexander, the transport secretary, is expected to bring the alleged fraud up in Parliament this week.
Another supplier for HS2 under investigation, the Danny Sullivan Group, has been suspended from creating new contracts until the inquiry has finished.
A HS2 statement said: “We treat all whistleblower allegations seriously and are continuing to conduct our own investigation.
“Furthermore, HS2 Ltd has formally reported the allegations to HMRC, and we encourage anyone who believes they may have relevant information, which could support our enquiries, to report it in confidence via HS2’s Speak Out channels.”
HS2 subcontractor fraud case a result of HS2 investigation
In May, HS2 ramped up an investigation into potential major fraud and said that two labour suppliers were under investigation.
At the time it was suspected that a senior works manager has been accepting bribes from a supplier to give them extra work on the HS2 project, while the other firm under suspicion was suspected of providing self-employed CIS workers, charging too much on PAYE, and utilising offshore payroll companies to hide false payments.
It was understood at the time that the Danny Sullivan Group was under investigation, who responded: “We are aware of the allegations that have been raised in relation to HS2. As a business with a long and reputable history we take these allegations extremely seriously and are co-operating fully with the ongoing investigation. We have acted swiftly to respond to the information, commissioning a detailed and thorough internal review, which remains ongoing.”
Early this year, in February, HMRC working with Kent Police jailed an organised construction crime group for not paying owed VAT payments, as well as skimming financial deductions from sub-contractor agreements.
The members of the construction organised crime group included:
- Phillip Bailey, 36, was jailed for six years and three months on charges of conspiring to cheat the public revenue and transferring criminal property
- Daniel Newton, 37, was jailed for nine years and four months on charges of conspiring to cheat the public revenue and transferring criminal property
- Kevin Ratcliffe, 43, was jailed for 27 months on charges of conspiring to cheat the public revenue and acquiring criminal property
- Sean Dean, 41, was jailed for seven years on the charge of conspiracy to cheat the public revenue
- Lee Hudson, 56, was jailed for five years on the charge of conspiracy to cheat the public revenue
- Sarah Gillard, 41, was jailed for two years and given a two-year suspended sentence on the charge of acquiring criminal property
- Bradley Mortimer, 39, was jailed for three and a half years on the charge of entering into a money laundering arrangement
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