For those who came in late, Changtel Solutions – AKA Enta Technologies – was wound up in 2015. The taxman found that it owed him £15.5 million in VAT liabilities after conducting an illegal exporting scam for a decade. HMRC has since claimed that it is owed over £42 million.
Tsai has now been given an 18 month jail sentence at the High Court of Justice for a string of offences, including hiding various bank accounts and properties from HMRC during its investigation, and also breaching orders preventing him leaving the country. In total, Tsai was given prison sentences of various lengths for 30 of the 53 alleged breaches, all of which were ordered to run concurrently and the longest being 18 months.
Mrs Justice Rose said: “Having seen Mr Tsai give evidence and in the light of the matters I have described above, I have formed the view that Mr Tsai was a thoroughly dishonest witness and that almost all the answers he gave during his oral evidence in the witness box were deliberate lies aimed at misleading the court. I believe very little of what he said, unless it was adverse to his own interests.”
In sentencing Tsai to 18 months imprisonment, the judge said that Tsai could apply to have the sentence shortened if he complies fully with the freezing order, but not to a period shorter than 12 months.
Changtel liquidator Begbies Traynor filed proceedings against Tsai on 15 February this year, claiming he had breached sections of the Insolvency Act 1986. Following a hearing on the same day an order was granted freezing Tsai’s assets globally – totalling £27.4 million.
Begbies Traynor had access to Changtel’s computer systems and servers during its investigation and claimed that Tsai had hidden a number of assets, predominately by placing them in the name of his wife and other relatives.
Alongside this, Tsai breached a part of the freezing order banning him from leaving the country to fly to Taiwan.
Tsai was ordered to hand over all his passports and travel documents, but claimed that his Taiwanese passport was in the possession of his travel agent for the purposes of obtaining him a Chinese visa. Tsai failed to surrender this passport and travelled to Taiwan to meet his wife whom he said was undergoing medical treatment.
During this time, his wife travelled to Singapore to transfer £8.6 million from an account in Singapore to Taiwan. The judge found the evidence of Tsai’s wife’s health to be false and handed down a 15 month sentence for this breach.
The court also looked at a £2.3 million loan “made by Tsai’s sister-in-law” to Entatech UK in 2014. Entatech UK went on to be sold to Dave Stevinson’s Stevinson Capital in 2015, and the loan is still on the defunct distributor’s books.
Tsai claimed the loan had nothing to do with him and should be repaid by its April 2018 deadline. The judge however ruled that the loan had in fact come from Tsai, and handed down an additional six month prison sentence.
Tsai claimed to have been impeded by a language barrier with his native language being Taiwanese, adding that he “struggles when English is spoken at speed, softly or quietly”. He claimed to have not understood various parts of the freezing order because an interpreter had not been present. This was news to the liquidators, who claimed they had often had coherent conversations with Tsai.
Tsai claimed illness as another reason claiming a 2009 cancer battle in 2009 had left him on medication that causes symptoms including confusion, drowsiness and an inability to concentrate – all of which had directly caused him to “misunderstand several important aspects of the case”.
Mrs Justice Rose gave that argument short shrift saying that if Mr Tsai was really as ill as he claims there would be many more documents generated by GP or hospital visits.
“I find that Tsai’s supposed medical problems are a fabricated excuse and that he has no medical or hearing problems that have contributed to his conduct during these proceedings.”
Tsai also had another go claiming that he had had contemplated suicide. The letter contained a doctor’s report which stated that Tsai was suffering from “severe” levels of depressions and had “investigated over the internet methods of hanging to cause suicide whilst being detained”.
The judge said that Tsai displayed no difficulties with either short-term or long-term memory, with levels of concentration or with tiredness.
“His answers to questions were at all times pertinent and coherent, even if, as I have held, they were mostly untrue.”