Jersey Unreported Judgments

[2008]JRC011

ROYAL COURT

(Samedi Division)

25^th January 2008

The Attorney General

-v-

Joao De Jesus Pires

Sentencing by the Inferior Number of the Royal Court, following a guilty plea to the following charges:

Age:  55.

Plea: Guilty.

Details of Offence:

The defendant is the beneficial owner and co-director (with his wife) of a Company which owns and rents out a property comprising of 2 flats and a maisonette.

Over a 15 year period he systematically failed to declare the complete extent of the income derived from the property to the Comptroller of Income Tax.  The defendant delivered to the Comptroller annual financial statements stating that the property produced a weekly rental income of £100 from each of the two flats and £130 from the maisonette.  These statements were relied upon by the Comptroller for the purpose of assessing annual tax liabilities.

Following an enquiry into the letting of the property, signed statements from the tenants, confirming the rents to be £100 and £130 respectively, were submitted by the defendant.  During a meeting with the Income Tax authorities, the defendant again confirmed those rents and stated that they had not been increased for some years.

However, when the tenants were spoken to, they explained that the content of their letters was false, and that they had been written by the defendant who had directed them to sign them.  At this stage, the defendant admitted his fraud and provided the Income Tax authorities with details of the rental income he actually received from the property over the stated period.  The defendant admitted preparing letters and asking his tenants to sign them, knowing them to be fraudulent statements.

Overall the defendant failed to declare income in the amount of £139,500 between 1990 and 2004 inclusive and escaped tax liability for £25,110.

Details of Mitigation:

Guilty plea entered at earliest opportunity, remorse, embarrassment, good character, very hard working man, and good references.

Previous Convictions:

2 previous convictions for 3 motoring offences.

Conclusions:

Total: £46,000 fine (28 weeks; imprisonment in default) and £2,000 costs.

Sentence and Observations of Court:

In spite of powerful mitigation, the very aggravating nature of the defendant's involvement of his tenants in his fraud prevents the Court from reducing the Crown's conclusions.

Crown's conclusions granted.

Defendant given 28 days to pay.

C. M. M. Yates Esq., Crown Advocate.

Advocate S. M. Baker for the Defendant.

JUDGMENT

THE DEPUTY BAILIFF:

1.        Mr Pires, over a period of some 15 years you made false tax returns about the amount that you were receiving by way of rental.  In aggregate you under-declared your income to the extent of some £139,500 and as a result you evaded tax in the total sum of £25,110.  Your offence was aggravated by the fact that you persuaded your tenants to sign letters which supported the false information which you had given to the Income Tax authorities about the level of rent which they were paying.

2.        Mr Baker has spoken very powerfully on your behalf.  We accept that you are an extremely hard working man, who has built up a very successful business and has paid substantial amounts of tax on the profits of that business.  You are of previous good character, we ignore completely the motoring offences.  You have had excellent references produced by a number of people, which indeed make it clear that you work extremely hard even to the possible detriment of your health.  You have now paid the arrears of tax and we accept, as Mr Baker has said, that this was an extraordinarily stupid act on your part which you now regret. 

3.        We are very sorry to see you here.  You have built up this successful business, you are a respected member of the Portuguese community and you have contributed not only to them, but also to Jersey.  Had it not been for the aggravating factor we have referred to, we would probably have been able to go along with Mr Baker's suggestion to an extent.  But you got your tenants to sign letters, you involved them, they must have been put in an extremely difficult position.  It was, no doubt, almost impossible for them to refuse your request because you were their landlord.  Having persuaded them to write a false letter, they then were interviewed by the Income Tax and only at that stage did the truth come out.  Your involvement of third parties in your deception is an aggravating feature which means that we do not, despite all the very strong mitigation put forward by Mr Baker, feel able to reduce the conclusions.

4.        We are going to grant the conclusions of the Crown and therefore they are as put forward by the Crown making a total fine of £46,000 and there is a sentence of 2 weeks' imprisonment in default, consecutive on each count, and you must pay costs in the sum of £2,000.

5.        You will have 28 days to pay.

No Authorities