A BUSINESS owner tried to scam HM Revenue and Customs out of more than £4million in a botched VAT fraud scheme, a court heard.

Darryl Lee, of Fawkner Way, Stanford in the Vale, Faringdon, denies one count of attempting to cheat HMRC by fraudulently claiming a VAT refund totalling £4,166,674.

The 44-year old, Oxford Crown Court heard as his trial began yesterday, had set up a business called Subterranean World Solutions whose goal was to find suitable sites for dumping nuclear waste.

Prosecutor David Bright told the jury of five women and seven men that after registering the company as VAT regulated he drew up a number of correspondences from the company to himself, demanding immediate payment totalling about £25million.

He then in turn drafted promissory notes agreeing to pay the money back to the company he had created.

Lee then contacted HMRC to ask for a refund on his VAT in light of the expected payments, as any legitimate business would be entitled, except, prosecutors allege, the business was not able to claim the refund.

He told the court: "It was a sham. The whole thing was a sham.

"This is absolute nonsense and thoroughly dishonest. It would take about 30 seconds to work out there is no money behind these [notes] and it's not worth the paper it is printed on."

The court also heard that Lee had fabricated meetings supposedly held at Covent Gardens, London, with a 'board of directors' as well as listing a neighbour as a director, despite her having no knowledge of what he was doing.

Lee denies the charge and the trial, expected to last three days, continues.