DSD probe of Tullyally group went cold: letter

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Full details of the investigation of the Tullyally and District Development Group Ltd (TDDG), which ceased trading in 2012 after accumulating £100,000 in debts, have been published by the Department of Social Development (DSD).

Back in January 2012 DSD’s North West Development Office (NWDO), which is based at Orchard House became aware that the group had ceased to trade.

NWDO subsequently discovered that HM Revenue and Customs (HMRC) was in the process of seeking a petition to liquidate the group as the result of an outstanding debt of £95,981.92.

According to a final management letter dated July 10, 2013 and drafted by Jacqueline McLaughlin of the DSD Corporate Investigations Unit, the NWDO referred the case to it for investigation on the grounds that “the debt owed to HMRC raised concerns about the misappropriation of funds provided by the department to pay certain costs to HMRC”.

The letter, which has been published by DSD, concludes that: “It has not been established how much, if any, of the funds provided by the department to the group for costs relating to HMRC have been misappropriated.”

It states: “As the investigation has been unable to secure any evidence to determine whether criminal activity has taken place, we consider that it is not appropriate to refer the matter to the police.”

And finally it says: “North West Development Office may wish to seek legal opinion on whether it is appropriate to seek recovery of the grant payment in these circumstances.”

Greater detail is provided about the probe.

For example, in February 2012, the NWDO visited Tullyally and seized a large number of records for “safe keeping.”

It was subsequently discovered that the group incurred penalties for the late submission of its ‘Employer Annual Return’ to HMRC in 2003, 2004, 2006, 2008 and 2009

It also under-paid tax and National Insurance (NI) for the years ending 2005, 2006, 2007 and 2011.

But the letter states: “There are no records available from the Department, the Group or HMRC, which would enable CIU to identify how much, if any, of the outstanding HMRC liability is in respect of the staff whom the Department funded.

It was thus impossible to say how much of the unpaid tax related to funding from DSD.