TWO East Lancashire men have been jailed for their part in an £85million VAT scam.

Brett Issitt of Manor Close, Todmorden, and Michael McNeill of Loveclough Park, Rossendale, were among a gang of six jailed for a total of 47-and-a-half years at Liverpool Crown after one of the biggest investigations by HM Revenue & Customs.

The court heard the multi-million pound fraud centred on the mobile phone industry.

Investigations by HMRC began in 2000 and involved breaking the audit trail of 98 businesses in the UK, Germany, Belgium, Spain and the Netherlands. The fraudsters were directors and executives of seven of the companies identified during the trial.

They were found guilty of Conspiracy to Cheat the Public Revenue following a trial.

Issitt, 32, was sentenced to 10 years for his part and disqualified as a company director for 10 years.

McNeill, 36, was sentenced to seven-and-a-half years and disqualified as a director for eight years.

The scam involved importing mobile phones into the UK VAT free through various companies set up by the fraudsters, who then sold the phones on, charging VAT that was never paid to the government. These companies then went missing'.

The phones were sold down the line to buffer traders before they were exported again, often to be repurc-hased by the original companies, a fraud known as a carousel.' Over a 19-month trading period HMRC officers identified losses of over £85million in VAT linked to the activities of the fraudsters.

The gang also face having their assets stripped as part of confiscation proce-edings. All those sentenced were given disqualifications for directorships of UK registered companies.

Raymond Cox, 37, of Staffordshire, Paul Sweeney, 36, who lived in Amsterdam, Peter Glover, 52, of Warwickshire and Colin Jones, 41, of Cheshire were also jailed.

The case against a seventh defendant, Sarah Louise Smith, 34, of Wilmslow, Cheshire, was left on file following the failure of the jury to reach a verdict.

Peter Hollier, head of criminal investigation in the North West for HMRC said: "This was not some kind of victimless crime, but organised fraud on a massive scale perpetrated by criminals all bent on making fast and easy profits at the expense of the British taxpayer."