A North Sea contractor has narrowly avoided jail after swindling two oil and gas firms out of almost £34,000.
David Foster’s oil services company went into liquidation in April 2011, leaving him no longer registered to pay the tax.
However, the 58-year-old continued to trade.
Over 16 months, he submitted 34 separate invoices asking Offshore Marine Contractors Limited and Interocean Marine Services Limited to pay VAT – but kept the money for himself.
In total he fraudulently took £33,836 from the two firms, not declaring any of it to HM Revenue and Customs (HMRC).
Yesterday Foster appeared at Aberdeen Sheriff Court and admitted carrying out the scheme between March 16, 2011 and July 16 the following year.
The court heard that on the invoices Foster submitted to the companies he stated he was entitled to charge VAT for the services he had provided them.
He also “pretended” to the companies that he was registered for VAT when he was de-registered on April 4, 2011.
As a result he claimed he was charging Offshore Marine Contractors Limited £20,610 in VAT and Interocean Marine Services Ltd £13,226 in tax, when he was pocketing the cash himself.
Fiscal depute Anne MacDonald said it was a “scheme repeatedly used to deliberately set out to deceive”.
She said the fact Foster, of 2 Home Farm Cottages, Durris, submitted numerous invoices asking the companies to pay him VAT showed he knew exactly what he was doing.
However, representing the offshore worker yesterday, solicitor David Sutherland said his client had used the money to pay off old debts.
He said he had not been swindling the firms in order to live a “lavish lifestyle”.
Mr Sutherland said his client had originally been registered to pay VAT before his firm, Foster Offshore Services Limited, had gone into liquidation. He said he therefore expected to have to pay the VAT on the jobs he had since carried out at a later date.
Mr Sutherland said that as a result, Foster was planning to use the money he had fraudulently claimed to pay off this tax bill.
The lawyer said his client was “ashamed” of his behaviour and that he had started to repay money to HMRC.
Sheriff Graham Buchanan said that because Foster had not been swindling the companies out of money to live a life of luxury, he was willing to spare him a prison sentence.
He was ordered to carry out 270 hours of unpaid work in nine months.