Court hands director one of longest disqualification periods on record
Kevin Rabbitte had been involved in scheme that resulted in €1.2m Revenue fraud
Kevin Rabbitte, a director of a Westman Plant and Civils Limited, should be disqualified for a period of 14 years and three months.
The High Court has imposed one of the longest disqualification periods ever handed down on a company director who admitted his role in a scheme which resulted in a Revenue fraud of more than €1.2 million.
Mr Rabbitte had been involved in “a carefully coordinated and planned fraud”, the judge said He also said he was giving Mr Rabbitte a “5 per cent discount” off the maximum 15-year disqualification allowed under the 2014 Companies Act because he had made certain admissions and consented to various orders shortly before the bid to disqualify him was due to be heard by the High Court.
Earlier this week, Mr Rabbitte consented to a declaration that, as an officer of the company, he had knowingly carried out business on behalf of Westman with the intention of defrauding the firm’s creditors, including the Revenue Commissioners.
He also consented to being made personally responsible for €1.5 million of the company’s debts and liabilities but, given Mr Rabbitte’s available assets, there was no reality of that sum being recovered, the judge said.
Mr Rabbitte also agreed that he would be disqualified from acting as a company director for a period.
The court heard, as part of the fraud, Westman’s VAT number was used to buy machinery and plant equipment, imported mainly from the UK into the Republic, between July 2014 and June 2015.
Mr Rabbitte would bid for the machinery and if successful he would use Westman’s VAT number to acquire the goods.
It is claimed VAT due on the goods bought in the UK was not paid to Revenue when the machinery was subsequently sold on in the State. This resulted in Revenue being defrauded of €1.2 million.
The company, incorporated in 2014 and wound up in 2017, never declared the purchases or any subsequent sales for VAT purposes. It filed nil VAT returns for the relevant period.
The application against Mr Rabbitte, of Clonberne, Ballinasloe, Co Galway, was sought by the company’s liquidator Myles Kirby, represented by John Kennedy SC and Sally O’Neill BL.
Mr Kirby claimed Mr Rabbitte had knowingly participated in a fraud known as “carousel fraud” or Missing Trader Intra-Community VAT Fraud.
Mr Justice O’Moore said, while it “had its complexities”, the “nature of the fraud was fairly straightforward”. It was also a serious matter, which merited “a significant” disqualification.
Mr Rabbitte, represented by solicitor Robert Dore, was entitled to a small discount over consenting to certain orders, thus avoiding the costs of the full hearing of the application seeking disqualification orders, he said.
The judge also noted Mr Rabbitte had claimed he was a front for an unnamed individual to purchase machinery auctions in return for a commission.
The judge remarked that third party had not been named by Mr Rabbitte who had claimed he and his wife were in fear and were “petrified” of that individual. While this was an unusual part of the case, it was not something the court could take into account in regard to the disqualification order, he said.
In a sworn statement, Mr Rabbitte had admitted to acting and dealing with the unnamed individual without any fear of intimidation, the judge said.