A fraudulent accountant took £280,000 from three companies she was working for, bankrupting one of them and leaving 28 people unemployed. Joanne Hughes, who runs her own accountancy firm, preyed on the vulnerability of the company owners who had little knowledge of accounts and repeatedly kept money owed to the then HMRC for herself.
The deceitful 48-year-old from Porthcawl, Bridgend, eventually pleaded guilty to charges of fraud against TRIO Construction, TRIO Mechanical and RJ Site Spray four days into a trial in May, Cardiff Crown Court heard on Friday. The extent of the financial loss to the companies was so great that the defendant cannot repay the full amount, agreeing to pay £130,098.35 following the sale of her caravan and other valuable assets she purchased with the dirty money.
Hughes reassured all three south Wales-based companies that the payments were being sent to HMRC during the period of offending between 2014 and 2018, when in fact she was only declaring a small portion of the turnover and paying the remaining larger sums into her bank account. It was only in 2019 when another accountant notified one of the businesses about their “awful” accounts that an investigation started. HMRC though had already grown suspicious, the court heard.
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Thomas Stanway, prosecuting, told the court that the owner of RJ Site Spray was so stressed with the impact of the financial losses due to Hughes’ actions that he suffered two strokes while trying to resolve the matter with HMRC. He explained how RJ Site Spray was liquidated last year and all employees, 28 in total, lost their employment.
Mr Stanway read victim impact statements in court from the business owners. The owner of RJ Site Spray told the court the experience leading up to the company’s liquidation last year had been “overwhelming” after he “fought to keep the company going”. “That we were left with the stark reality we would have to pay HMRC what we owed was a sickening thought as we had assumed we had already paid this money,” he said.
“I was desperate to keep the company going and I didn’t want these people to lose their livelihoods. Throughout the investigation I resorted to a number of ways to try and save the business.”
He explained how he sold a number of assets including his Ford Escort for £14,000 which had been a “life goal” to buy. “I also sold the family campervan which was not only a consequence to me but my family as I could not carry out our previous lifestyle. This has all been as a result of the money which was stolen from me by Joanne Hughes.
“In 2020 I could not see any light at the end of the tunnel, and I suffered two strokes. I lost my vision in my right eye and I now have serious balance issues which does not allow me to walk unaided.
“In 2021, following further discussions with HMRC, the company entered liquidation. I was absolutely gutted that all our hard work trying to keep the company going through this investigation proved fruitless. This was a direct cause of being victims of crime. I don’t think I will ever be able to put into words what this has done to me and my family.”
The owner of TRIO Construction and TRIO Mechanical said he had been good friends with Hughes, not only entrusting her to look after the books but also inviting her to many social events outside of work.
“Now I know the reality that Joanne stole from us from the start and her persona was merely a front,” he said. “My shock quickly turned to anger and frustration and I was lumbered with extremely large bills I owed to HMRC.”
He told the court how the company had “gone from strength to strength” and had built up extensive credible contacts within the industries. “We had contracts to honour and we didn’t want to disrupt the links that we had built up. We had twice the amount of HMRC debt.
“I was put through the stress and anxiety of attending court and providing evidence of what happened to me - something I never ever want to do again. We are delighted that the truth has now prevailed.
“The company continues to grow and expand. That would not have been the case if not for the desire and hard work we have put in.”
The defendant has one previous conviction for money laundering and another for obtaining credit cards fraudulently. Gerard Hillman, for Hughes, said: “Prior to this period in her life it had been a life of good character and for the last four years she has gone back to that way of living.” Mr Hillman said his client accepted that the offending was of the highest category, but added that it involved incompetence as well as dishonesty.
He told the court that his client had previously been a foster carer and that she is still entrusted by some companies to run their accounts. He explained too how her mother had suffered three strokes this year as a result of the stress that came with knowing that her daughter was facing a lengthy custodial sentence. The court heard how the defendant also has a son and employs people who would lose their jobs if she was to go to prison.
Judge David Wynn Morgan told Hughes, who had sat emotionless in the dock, that she abused a position of trust for her own gain to thwart three companies which were the product of “sheer hard work”. He told her: “They trusted you implicitly, and it was that trust which you exploited.
“Time and again you reassured the business owners that any errors were down to the revenue. You covered up that you were stealing from their companies. Eventually HMRC investigated and noted significant discrepancies.
“These companies are the product of sheer hard work and that in many ways is the most appalling thing about this fraud. The sums ultimately owed by the companies were so high that RJ Site Spray was unable to continue trading, and the owner of the company suffered two strokes.” Hughes, of Pintail Close, was sentenced to four years in prison, half of which she will serve behind bars.
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