Two people behind a business that imported hundreds of thousands of vapes disguised as medical equipment have been handed nine-year bans from running companies after HMRC found the firm had avoided almost £15 million in VAT and customs duty.
YSK Enterprises Limited imported large quantities of vapes from China between February and April 2023. A shipment of 352,688 vapes was intercepted by Border Force officers in Harwich after goods declared as nebulisers were found to be e-cigarettes.
The company, directed by Kyle McGinness and Leanne Moynes, subsequently told HMRC it owed no VAT on the sales and failed to submit corporation tax returns.
HMRC calculated that YSK Enterprises owed almost £15m in unpaid VAT and customs duty, as well as a further £437,101 in corporation tax.
McGinness, 24, was disqualified from acting as a company director for nine years in June. Moynes, 37, received the same length ban, which came into effect on 13 August.
The Insolvency Service said Moynes had also failed to preserve the company's accounting records despite repeated requests from the liquidator. Investigators were therefore unable to establish what had happened to more than £1.6m of company assets, including land, machinery and vehicles.
Dave Magrath, director of Investigation Services at the Insolvency Service, said the pair had gone “to considerable lengths” to disguise the goods they were importing before compounding the deception by telling HMRC they owed no tax.
“Illicit and unregulated vapes are a growing problem on our high streets, putting consumers and legitimate businesses at risk,” he said.
“This was a deliberate attempt to avoid millions of pounds that should have been paid to the public purse.”
The bans prevent McGinness and Moynes from managing, forming or promoting a company without court permission.
Richard Hopwood, head of the Insolvency Profession at HMRC, said the tax authority was determined to ensure honest businesses could compete fairly.
“The majority pay the tax that is due, but we will work with partners to pursue those who refuse to play by the rules,” he said.
Phillip Holliday, head of Central Region at Border Force, said illegal vapes and tobacco “undercut honest businesses and blight our high streets”.
“This case highlights the vital role Border Force plays in clamping down on this illicit trade. Through our intelligence-led enforcement action, we are protecting communities, levelling the playing field for business, and disrupting organised crime,” he added.