Dubious Accounts

As it happened, I was the first VAT officer to come across Vincent Riley. I had made an appointment to carry out an inspection at a terraced house in a congested corner of the town; I can’t remember now whose business was the subject of my visit, but I know that I was expecting to meet a self-employed building tradesman of some kind, a plasterer perhaps or a bricklayer. When I knocked on the door it was opened by a rather scrawny man in his shirtsleeves and with a day or two of stubble on his chin. When I introduced myself he didn’t say anything or proffer a hand to be shaken, he just nodded slightly and ushered me through a narrow hallway into a cramped sitting room where a younger man was stood by the fireplace, looking slightly nervous.

“This is my accountant, Mister…”

“Riley” said the younger man, extending his right hand towards me, “Vincent Riley.” He spoke clearly, but in a soft, unobtrusive voice.

“Oh” I said, “I don’t think we’ve met before.”

Riley was about the same height as me. He had slightly curly black hair which was cut relatively short when compared with the fashion of those times, and he was wearing a well-worn tweed jacket over a V-neck pullover and a tie. He also wore a pair of glasses with thick, black rims. Over all, he looked rather like a recent school leaver struggling to conform to the expectations of the adult world but I think he must have been rather older than his appearance suggested; perhaps he was in his middle or late twenties. I would conclude later that seeming to be a little immature but earnest was an essential part of his technique for obtaining clients.

“Mister Riley does all my book work” said the workman, “I’m no good at that sort of thing.” He shuffled his feet and looked uncomfortable. “You need to talk to him, not me, and I’ve got a job to go to, if you don’t mind.”

“Well” I began “I should really…” I could not see any sign of account books or other papers in the room and there was no table to work on. We were stood rather awkwardly in a group surrounded by an assortment of comfortable but impractical armchairs.

“I keep all the books at my house” said Riley. “You can see them there; it’s not very convenient here.”

“Well…” I began again.

“I’m not far away,” Riley continued “and I can answer all your questions” he added, implying that his client could be allowed to go to his work without causing us any difficulty.

The visit was definitely not proceeding in accordance with the Department’s official instructions, but I seemed to be faced with a fait accompli and as my main purpose was to check the trader’s books I decided that I would have to go along with Riley’s suggestion. I asked a few very basic questions of his client before we left, and then followed Riley’s directions to his own house which was about a five minutes drive in my car.

Riley’s house turned out to be one of those post-war council houses that, in those days, were occupied by tenants who paid a modest rent to the local authority. Riley was letting himself in through the front door when I arrived; I followed him inside and he directed me into the front room where there was a dining table and chairs, all looking old enough to be second-hand, and no other furniture except for a grubby mirror above the fireplace.

“Would you like a coffee?” he enquired.

“Yes, please” I replied; it was an automatic reflex.

While Riley was out of the room I selected one of the chairs, sat down, pulled the case file out of my briefcase and placed it on the table in front of me. I could hear indistinct voices from elsewhere in the house and I realised that Riley was in conversation with a woman, probably in the kitchen. A small boy suddenly appeared beside me; he must have come into the room very quietly. He was wearing only an unwashed t-shirt and he stood staring up at me silently, a thumb in his mouth.

 “Hello!” I said. He continued to look at me for a few moments and then turned and scuttled out of the room without attempting to reply.

Riley returned soon after that, bringing me a cup of the roughest coffee I had ever experienced. I was grateful that he was out of the room again while I recovered from the first mouthful. He reappeared with a small, battered suitcase which he laid on the table and opened to reveal a commercial accounts book and some loose-leaf papers which were apparently his client’s business records.

“There’s not much for you to see” he said. “He hadn’t set anything up when I took him on, so I’ve started a cash book for him. I’ll be seeing him every week or two to bring it up to date.”

He was right; as the client worked as a sub-contractor on new houses his services were zero-rated, and there wasn’t a lot of tax at stake on his expenses either so there wasn’t much detail to look through and I don’t recall spotting any obvious errors. I decided that I should find out a little more about Riley himself.

“Have you been here long?” I asked, “I thought I knew all the accountants in town.”

He seemed to hesitate slightly before answering, or it might just have been his natural manner. “I’ve started on my own recently” he said, and he paused again before adding “I’m not qualified to audit company accounts, but there’s plenty of work I can do for smaller businesses.”

“Like this chap?”

“Yes; he wouldn’t do any bookkeeping at all without my help”. He paused again before saying “He’s given me his cheque book too, otherwise none of his bills would ever get paid.”

I was surprised at the extent of the service Riley seemed to be offering his client, but I had come across more than one or two other equally unsophisticated tradesmen who might have benefited from a similar arrangement. After declining the offer of a second cup of coffee, I drew matters to a close and went on my way.

* * *

It was two or three months later when by chance I bumped into John, an occasional acquaintance of mine, at some kind of minor social event. I didn’t know John well, but I did know that he was working as an articled clerk at Ashgrove & Partners, a stuffy but respectable accountancy firm that had been serving the town’s business community for the past hundred years or so. On the rare occasions when we met we usually exchanged a little banter about accountancy or accountants as we weren’t sure what other interests we might have in common.

Rather unthinkingly, I opened the conversation with a blunt question: “Do you happen to know someone called Vincent Riley?”

John was visibly startled and came close to dropping the cup and saucer he was holding in one hand. “That name’s bad news” he said when he had recovered his composure. “Where have you heard it?”

“I met him a while ago” I replied, “doing the books for someone I had to visit.”

“He worked for us for a time” said John “and the partners are very embarrassed about it. We’re careful not to talk about him in the office.”

It was my turn to be surprised. “I don’t think he’s qualified” I said.

“Indeed, no!” John responded sharply.

We were both treading perilously close to unacceptable breaches of confidentiality and I had no compelling reason to probe any further. It would have been interesting to find out exactly how Riley had offended against the professional standards of Ashgrove & Partners, but it would have been at least tactless to enquire, so at this point I changed the subject.

Several more weeks passed by. I was sat at my office desk one day when the phone rang. It was an internal call from Doug, my Surveyor (I guess we would say ‘team leader’ today).

“Can you come to my office for a few minutes?” he asked.                                         I walked the short distance to Doug’s office and found that Reggie, our fraud investigation specialist was also waiting for me there.

“Close the door” said Doug, so I did that before taking the remaining spare seat which was more or less facing Doug across his desk. Reggie was slouched in a more comfortable, cushioned chair at the side of the room, wearing his trademark leather jacket and a plain, dark tie; he always managed to look relaxed.

Doug rested his elbows on the desk in front of him and wiped one hand absent-mindedly over his bald head, a familiar gesture. As usual, he was wearing an impeccably pressed white shirt and an unpretentiously expensive, pale grey suit.

“I believe you’ve met Vincent Riley” said Doug. “What did you make of him?”

“Well” I began “I’ve only seen him once…” I glanced at Reggie but I couldn’t pick up any sort of hint from his expression. “He looks quite young…” I continued feebly.

“What was his client like?” asked Doug.

“He was a building tradesman, apparently not competent at doing his own bookkeeping.”

Doug looked at Reggie who responded with an almost imperceptible nod of his head.

“Vincent Riley was going to do everything for him” I continued “and he seemed very happy with the arrangement.”

“Do you think Riley is reliable?” asked Doug.

I paused for a few moments of thought before starting to reply. “Well,” I said “I didn’t find anything wrong, but there was very little to see.” I wondered if I should mention my experience of Riley’s domestic circumstances, but that didn’t seem to be immediately relevant. Then I remembered my conversation with John. “I have heard that he was at Ashgrove’s for a time, but he left under something of a cloud. I don’t know the details.”

Doug and Reggie looked at each other again. Doug sat back in his chair and his face took on its most serious expression.

“We’ve got some information indicating that he may be stealing money from his clients” said Doug. “Unfortunately, even if it’s true, we can’t do much about it. It’s not a tax offence, we’ve got no evidence, and the amounts are likely to be quite small.”

“He had taken my chap’s cheque book” I said “apparently to make sure that his suppliers’ bills got paid.”                                                                                                        Reggie shifted himself to a more conventional posture, leaned forward in his chair and joined the conversation. “He picks up clients by chatting in pubs. He’s quite good at identifying the sort of self-employed people who find bookkeeping a chore. After a couple of pints they’re happy to let him take all that off their hands.”

“He would be good at that” I said thoughtfully. “He looks studious and he sounds conscientious.”

“We’re going to keep an eye on him” said Doug. “I’ve asked him to come in and see me later in the week. If he’s offering a genuine service to the sort of clients he seems to be attracting he could save us, and them, a lot of trouble; if not, we could have a problem. I’ve just told him that I like to meet new people operating in my area…” he glanced at Reggie “…and I won’t mention anything we’ve talked about today.”

“Let us know if you find out any more about him” said Reggie, waving to me as I left the room.

* * *

Time passed. There were visits to be done and small traders’ tangled accounts to be unravelled. One of my appointments was at an oriental restaurant in the basement of a Regency building along a side street a short distance from the local town centre. There were a number of such restaurants in the area, mostly serving Chinese or Indian food but, unusually for those times, this establishment was offering a menu of dishes from south-east Asia. The partners running the business were two men, probably in their thirties, who shared the necessary practical work between themselves without apparently employing any other staff. The premises were small and a little cramped; there was only room for four or five tables and if all the seats were occupied it would have been almost impossible to move around in the limited space available. I could understand why the partnership was declaring only a modest turnover, but it strained credulity that the business appeared to be making no profit at all; the mark-up applied by even such a modest catering establishment should have been more than enough to cover its day to day costs.

There were no obvious flaws in the restaurant’s accounts but I could not believe that the partners were surviving on such a tiny income. They were polite, and they seemed to be trying to answer my questions honestly even though their English was a little hesitant. Did they have other sources of income? Apparently not. Were they related to each other, brothers perhaps? No, apparently not; they did not know each other before they had started the restaurant. Did either of them have other family members in the town, or elsewhere in the country? No, they were on their own. A part of me wanted to believe everything they said, but the inner revenue official in my mind remained properly and professionally sceptical. It was clear that I would not be able to satisfy myself through the normal visiting procedure so I decided to report the case for further action.

Within a few days I had discussed the case with Shirley, who had been through some enhanced accountancy training, and together we had briefed the team of unselfish volunteers who made themselves available for evening meals out (in addition to their normal duties) so that the bookkeeping accuracy of our local restaurants could be checked in a practical way. The test eating team were enthusiastic about the potential for a successful outcome to my case; it seemed obvious that the declared takings of the business could not possibly be correct. It was agreed that six officers, in three pairs, would eat at the restaurant one evening, staggering their arrival so that they could fully cover the opening hours, note the number of other customers, and provide the information needed for an accurate estimate of that day’s takings. Shirley, who had something of the manner and appearance of a stern librarian, would then follow up this action by carrying out a formal visit as soon as possible to confront the partners with our evidence of their misbehaviour.

* * *

A few days before the valiant team of test eaters was due to sample the unknown culinary hazards of my restaurant, Reggie approached me at my desk with a simple request.                                                                                         “Can you do me a favour?”

“What sort?” I responded.

“Just give your friend Vincent a call for me.”

I wasn’t sure that I thought of Vincent Riley as a friend, but I couldn’t see any reason to decline.

“What do you want me to say?” I asked.

Reggie unfolded a computer print-out on the desk in front of me.

“This is our record of his VAT returns” he said. “He’s not paying us much, but that’s not the main point. This last return is a repayment claim and I’d like to know why.”

“It’s not very much” I said; the input tax Vincent had claimed on his expenses was obviously greater than usual but it was still a modest amount. “Has the return been rejected by the computer centre?”

“No,” said Reggie “that’s why I can’t really justify looking into it officially myself yet, but he’s met you and there’d be no harm in you just asking why his expenses have gone up.”

“Okay” I said “I’m busy now but I’ll try phoning him later today. I’ll let you know what he says.”

I had no problem contacting Vincent and he didn’t seem to be worried by my question about his tax return.

“I’ve bought a microfilm viewer,” he said “going cheap. It’s second-hand. I’m hoping to get some bigger clients and it could be useful then.”

“Right… er thanks,” I said “we just wondered what might be happening… er thanks again.”

Reggie allowed himself a hint of a frown when I repeated Vincent’s explanation to him.

“Well,” he said “it could even be true. At least it’s something that can be checked. I may drop in to see him when I can find some time.”

* * *

I expected to get feedback quite quickly from my colleagues’ foray at the oriental restaurant so I was rather disappointed that, several days afterwards, I had still not heard anything about it. I found a moment to visit Shirley’s desk and ask how the team had got on. She looked more than a little embarrassed and hesitated before answering me.

“To be honest,” she said eventually “it wasn’t a great success.” She paused, and then added: “You know we sent in six people, in pairs?”

I nodded.

“The total number of customers they had that evening” she continued “was seven.” She paused again.

“Have you checked their books?” I asked.

“Oh yes” said Shirley. “I made an unannounced visit the next day. The evening’s takings didn’t look quite right but if they had deliberately omitted anything it was probably that seventh customer’s payment. They were a bit ambiguous about it, but it seems likely that he was as much a personal friend of one them as a normal customer; he was certainly from their part of the world. I checked out their purchases and their bank records too, and I’ve still got no idea how they manage to keep going, but there’s no way I could come up with an assessment that would get past even a sleepy Tribunal chairman if they appealed against it.”

“Did you ask them how they survive?” I asked.

“Oh yes” said Shirley again. “They can feed themselves on surplus restaurant stock, of course, and, believe it or not, they say that their families are sending them money from home.”

We communed silently for a few moments.

“That’s it” Shirley eventually concluded. “I’m afraid that we’ll just have to put it down to experience; just another mystery of the Orient.”

* * *

Disappointment with the outcome of the restaurant case probably drove other things out of my mind and I had almost forgotten about Vincent Riley when he came to my attention again.

I was passing Doug’s office one day when, through the open door, I noticed that a small gathering was taking place there. Doug was sat at his desk, rubbing a hand over his bald head and Reggie was stood nearby. Facing them, with her back to me was a woman wearing a smart, black two-piece suit; I could also see the collar of an immaculate white blouse at her neck. Reggie noticed me outside and beckoned me in.

“I’m genuinely worried about this” the woman was saying. “It’s a very small sum and we’ll look quite ridiculous if the case is thrown out.”

“This is Mister Stanley, the officer who knows him best” said Reggie waving a hand in my direction. “Meet Miss Montague from Solicitor’s Office, here for the day from London. Tell her about Vincent Riley”                                            

“Oh, er… Hello” I said. Miss Montague had turned to face me and I was surprised to see that she was quite young and her formal work attire hadn’t entirely concealed her youth and femininity. I thought for a moment and then said: “Well, he’s softly spoken, very plausible… rather a pussy cat…”

“We’re off to Court in a minute,” Reggie explained “Mister Riley has an appointment with the magistrates.”

“Oh,” I said “I didn’t know. What’s he been up to?”

“You remember that call you made for me?” asked Reggie.

“About the repayment” I replied. “Yes; he’d purchased a microfilm reader, hadn’t he?”

“Not much of a microfilm reader” said Reggie. “I think it’s a biscuit tin with a hole in the base to fit a light bulb. It’s not a real purchase either; he probably made it himself, and typed his own purchase invoice; I’m sure it didn’t cost him anything.”

“But the claim’s for less than two hundred pounds of VAT” Miss Montague interjected; in a voice that combined nervousness with irritation. “We  wouldn’t even consider prosecuting such a small case normally, and now your officer is telling me that Riley will make plausible witness. I know that I’m still treated as a junior, but why have I been sent here at all?”

It was Doug who answered the question, rubbing a hand over his head again as he began to speak. “I’m sure you won’t have any problems,” he said. “It’s a very straightforward matter, and the money isn’t our main consideration. We’re hopeful that the local paper will have a reporter there; what we want is to get Riley’s name known around the town, so that potential clients may have second thoughts about employing him. He could become a thorough nuisance before long if we don’t do something about him now. If he actually pays a fine, and we get our tax back, that’ll be a bonus.”

“Time we were off” said Reggie. “I’ll take you in my car” he said to Miss Montague. “It may look a bit past it, but we don’t have far to go!”

The next day Reggie made a point of coming to see me at my desk. He had a broad smile on his face so I knew that he had good news.                               “How did it go?” I asked.

“Like a dream” he replied “but that’s not all.”

He sat on the corner of my desk. “Have you seen yesterday’s paper?” he asked.

“No” I said.

“Somebody else did” said Reggie. “The case was over before lunch, and the reporter from the local rag was able to get it into their afternoon edition. The story must have spread round the self-employed community surprisingly quickly, and people who’d given Riley their cheque books suddenly began checking up on their bank accounts.” He paused for a moment. “You remember the chap you were going to see the first time you met Vincent Riley?”

“Oh, yes” I said. “And..?”

“He was very nearly arrested for assault last night. There was quite a fracas in one of the town centre pubs. Riley still had a wonderful black eye this morning but, strangely enough, he didn’t seem inclined to press charges against anyone!”

That was the last we heard of Vincent Riley. Well, almost the last. It must have been two or three years later that Reggie took a phone call from a police station in a far away part of the country.

“We’ve detained one Vincent Riley for questioning about certain matters here” said the caller “but we understand that he may be a person of interest to you as well. Would you like to interview him while he’s in our hands?”

 “No thanks” said Reggie. “We won’t be needing him here again.”

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