Customs may be sued over VAT blunder

Two partners in a Leicester fish and chip shop are considering whether to sue Customs and Excise over a failed prosecution for an alleged £100,000 VAT swindle.

Costas Eleftheriou and his son Lefterakis were accused of the fraud following a raid on their Grimsby Fisheries restaurant in August 1990.

They each received an 18-month jail sentence after being found guilty of evading VAT payments at Leicester Crown Court in May 1992.

They only spent a week behind bars before the conviction was quashed at the Court of Appeal in London by three judges who said the Customs and Excise prosecution was fundamentally flawed.

But Customs and Excise commissioners still sought VAT payments they alleged were owed by the partners, until formally withdrawing their five-year-old claim against the men two weeks ago.

Steven Newcombe, solicitor for the pair, said the men were now seeking compensation for harassment and were "actively considering" suing Customs and Excise for malicious prosecution.

Costas Eleftheriou said the past five years had been a nightmare and called for reforms to the legal system in the handling of complicated fraud trials.