A British Sikh businessman faces extradition to Germany and a 15-year jail term if found guilty of value added tax (VAT) fraud allegations worth around 100 million pounds after he was arrested at Heathrow Airport in London last week.
Peter Singh Virdee, who denies the charges, was arrested on January 10 on a European arrest warrant, Scotland Yard confirmed.
Virdee appeared before Westminster magistrates court last week and was granted bail.
“Peter Singh Virdee, 43, a UK national, was arrested by officers from the Metropolitan Police Service’s Extradition Unit on Tuesday January 10 at Heathrow Airport. He was arrested on a European arrest warrant on behalf of the authorities in Germany, where he is wanted in relation to tax evasion,” a Metropolitan Police spokesperson said.
Prosecutors in Germany allege Virdee, who has a property company based in London, was one of the “central organisers” of a criminal enterprise to defraud the authorities of VAT on carbon credits under the EU Emissions Trading Scheme.
They claimed the tycoon worked “in the background” and tried to conceal his identity. According to UK media reports, the businessman is believed to have used several aliases and was known within the group as “Batman”.
A spokesperson from Carter-Ruck, the legal firm representing him, said, “Our client categorically denies these allegations; he has never been involved in carbon trading let alone in any kind of fraud. While he is happy to cooperate with the authorities, he intends to defend himself fully against these allegations and the attempts to extradite him to Germany.”
Virdee is accused of operating a so-called “VAT carousel” scheme on EU carbon credits, under which traders export the credits from one member state to another in order to take advantage of EU VAT rules. As exports, the sales are exempt from VAT, but the traders charge their customers VAT which they never declare to the authorities. The scheme ran from 2008 to 2012.
Prosecutors in Frankfurt have been pursuing the case for several years.
Virdee describes himself as the first Sikh patron of the English National Opera and a philanthropist via his Peter Virdee Foundation.
It is reported that businessman Virdee, a visiting professor at Manchester Metropolitan University, handed the Conservative party £98,000 since 2011 through his company B&S Properties. He was invited to a meal with a senior minister and other donors in 2012.
