Court gives high sentences for tax evasion in metal trading

Zlin, South Moravia, Feb 18 (CTK) - Six Czechs, two Ukrainians and one Russian were given prison sentences of three to 7.5 years for tax evasion in metal trading worth almost 89 million crowns.

The head of the group, Czech citizen Jan Svedik, 33, was given 7.5 years sentence for a similar crime last September. The verdict is not yet valid.

State attorney Leo Foltyn said the group expediently created a chain of business companies via which it was carrying out speculative purchases and sales of goods - non-ferrous and other metals.

The fraud was based on the existence of a "lost retailer" among the firms, so-called buffer companies, who did not pay VAT.

The members of the group split among themselves the amount "saved" in VAT according to a key agreed at the start, Foltyn said.

The bigger companies were to cover up the fraud with their feigned trade activities so that authorities may not expose it.

For this purpose, firms with a good image and problem-free records were included in the chains, which further complicated the exposure of the tax evasion, Foltyn said.

According to the indictment, Svedik was negotiating supplies of goods to Slovakia and Germany, set the prices as well as remuneration for his partners who figured in the case as executives or heads of the participating companies' boards.

Svedik, who has been prosecuted in another case with a similar criminal activity and in a bribery case, pleaded guilty at court and helped prove his accomplices guilty.

Another Czech also pleaded guilty, while four Czechs, two Ukrainians and one Russian dismissed any guilt, but the court did not believe them.