Six years for accountant who swindled clients out of tax money to finance luxuries

Darren Upton
Darren Upton
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A CROOKED accountant who financed a luxurious lifestyle, including a secret mistress and a box at Leeds United, by fleecing clients of thousands of pounds intended for the taxman, has been jailed for six years.

Those targeted by Darren Upton believed they were paying Corporation Tax to the Revenue but he had given them his own business account details instead.

As a result of his dishonesty he had cost his clients and the Revenue around £500,000, Nicholas Worsley, prosecuting, told Leeds Crown Court yesterday.

Between January 2010 and June last year he took money out of his firm, Upton and Co Accountants, of Wood Street, Wakefield, for personal expenses including designer clothes and travel.

He spent nearly £3,000 on model railways and almost £10,000 on his box at Elland Road.

Although married, in October 2010 he went on a dating website purporting to be single and met Victoria Fraenzel, a make-up artist and part-time model and began a relationship with her.

He rented her a flat in a luxurious development in Salford paying the deposit and £800 a month rent.

He also began paying for a Mercedes sports car for her as well as giving her money as a living allowance and bought her clothing from Harvey Nicholls, lingerie and expensive Mulberry handbags.

Mr Worsley told the court they enjoyed nights out at various Hilton Hotels and she considered herself his girlfriend, only becoming aware Upton was married with a young child when a problem over payment arose and she contacted his office.

Upton, 40, of Holmsley Lane, Woodlesford, Leeds, has admitted 15 charges of fraud with 23 other offences taken into consideration.

He has also admitted contempt of court by breaching a Restraint Order made last year limiting him to using the firm’s bank accounts for legitimate business purposes.

Mr Worsley said in spite of that Upton used around £14,500 as deposits to refinance a Bentley Continental which had his personal number 319 DJU and a Maserati TLU 19 used by his wife Tina, when another company terminated the finance which would have meant their repossession.

He told the court it was not the first time Upton had been investigated.

In 2010 after he ran an unauthorised collective investment scheme, the Financial Services Authority had recovered £3.7m in compensation for his investors. No charges were brought against him but he was ordered to pay a further £840,000 in monthly instalments.

Upton and Co had around 800 clients spread all over the country, many being one man businesses working in information technology or consultancy markets who had found him over the internet.

He provided accountancy needs such as PAYE calculations, VAT calculations and year end accounts including Corporation Tax, charging a monthly fee.

Upton was the director, his wife was company secretary, and he employed five trainee accountants who actually prepared the accounts which were checked by a supervisor or Upton.

The clients were then directed to pay the tax to HMRC but those swindled were given Upton’s bank account numbers instead.

He would then submit to the Revenue that nil tax was due so clients thought it had been paid and HMRC was not expecting tax.

A couple of clients realised they had got the wrong account details and made correct payments to HMRC but Upton submitted nil returns and obtained a refund, and fobbed off clients when queries arose.

Staff at his firm became increasingly concerned about the situation when Upton claimed to have sorted out problems and eventually reported him to the police themselves.

Mr Worsley said the 33 client firms affected were being pursued by HMRC for the unpaid tax on the basis Upton was acting as the client’s agent.

Many were facing financial and business problems as a result.

One said: “I am absolutely devastated I have been left in this position and it has had a massive effect on my business.”

He said he had planned to extend and employ more staff but as a result of Upton’s actions that was not now possible.

James Littlehales, for Upton, said the offences occurred after he found his income being cut when he had to pay his regular instalments to the FSA from the previous scheme and was “not prepared to cut back on his lifestyle that’s apparent from the figures you have seen.”

“In terms of his lifestyle it was luxurious” but he said since then Upton, who has an 18-month-old child, had been made bankrupt.

After the sentence, Det Sgt Gary Ferris of West Yorkshire Police, said: “Upton abused his position as a trusted accountant to steal hundreds of thousands of pounds, not only from his clients but from his own personal friends.

“He was incredibly deceitful, tricking them into depositing cash into his business’ bank account under the pretence that they were paying their Corporation Tax. Not only was he stealing monies from his clients, he was also blackening their names with the HMRC and continued to carry out his crimes even when he was on bail.

“The sentence he has received is a reflection of the seriousness of his crimes and I am pleased that justice has been served for the victims of his deception.”