HMRC has
launched an internal investigation into the conduct of officers
involved in a flawed prosecution bought against Frank Dowling, a high-profile London
restaurateur.
The four-year investigation into Mr Dowling, who ran several
venues in London’s O2 Arena, collapsed in 2017 and cost the tax payer
over £250,000.
Dowling claims the debacle cost him his business empire and affected
his mental health. He faced ten years in prison during the ordeal.
The internal inquiry, which was launched in May, will probe allegations of a criminal conspiracy against Mr Dowling.
His multi-million-pound business was put into liquidation soon after he was arrested in 2013 for alleged non-payment of tax.
All charges against Mr Dowling were eventually dropped last year and
he was awarded £274,000 in costs after the prosecution admitted it had
no evidence to offer in the case.
HMRC internal affairs officers are now understood to be scrutinising
court documents and witness statements following complaints that tax
office personnel involved in the case, codenamed Operation Byword,
colluded with accountants and insolvency practitioners to ruin the
American businessman.
At the
time of his arrest, Mr Dowling was working with accountants to
restructure his business in order to refinance and pay off debts. The
three leases he owned in the O2 are believed to have been worth around
£18m.
Following his arrest, administrators working with HMRC seized his company and placed it into liquidation.
In
addition to the venues at the O2, which were Union Square, American Bar
& Grill and Inc Club, MrDowling’s company, Greenwich Inc Trading
Ltd, ran several other pubs, bars and restaurants including the Elbow
Rooms pool bar chain, Trafalgar Tavern, Admiral Hardy and Bar du Musee.
The collapse of the business left Greenwich Council with a £350,000 hole in its coffers through lost business rates.
It is expected that the scope of the inquiry will extend to look at
links between senior tax office investigators and several accountancy
service businesses involved in the case.
Mr Dowling is quoted by
The Telegraph:
“The original accusations were made by individuals to forward their
own commercial interests and accepted by authorities although they had
proof to the contrary.
I and my family have been through hell as they tried everything they could to ruin me.
It has been devastating for my business interests as many third
parties decided to treat me as guilty and sought illegal and immoral
means to seek commercial advantage, but the truth is out there for
everyone to see now. There’s a feeling of relief that it is over but
also anger at what they have put me through and how much money has been
wasted.”
He believes the documents disclosed to him show a web of collusion
between parties and maintains that he was the target of a malicious
campaign. He believes details of his arrest were leaked to the press by
officials and that investigators were intent on prosecuting him before
any evidence had been uncovered.
He alleges a string of offences have been committed including
perjury, perverting the course justice and conspiracy to defraud. The
investigation is expected to take several months.
An HMRC spokesperson said:
“We do not comment on the affairs of individual customers.”
This will be one to watch!
Tax does have to be taxing.
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