While the criminals stole vast sums of money via elaborate fraud schemes, British tax authorities allegedly “did little to disrupt the network” for years.

A criminal network based in the UK managed to steal billions of pounds worth of taxpayer money via fraudulent schemes and used a portion of these gains to help fund al-Qaeda* in Afghanistan and Pakistan, the Sunday Times reports citing police and intelligence documents.

The criminals were able to steal “an estimated £8bn in public money alone” (over $10 billion), with 1 per cent of the funds going to terrorists.

The money was reportedly procured via "VAT and benefit frauds against the exchequer", along with "mortgage and credit card fraud targeting banks and individuals".

According to the newspaper, the gang was also associated with one of the perpetrators of the 7 July 2005 London bombings which claimed the lives of 52 and left over 700 injured.

As the Daily Mail points out, the British authorities became aware of the gang’s activities back in 1995, with the resulting four-year investigation by the Inland Revenue concluding that the criminals were using "a network of factories and companies and exploiting their workers for identity and benefit frauds, the sale of counterfeit goods, car crash scams and mortgage and credit card frauds."

The newspaper also notes that the Her Majesty’s Revenue and Customs (HMRC) and other agencies "did little to disrupt the network" for years, with requests by at least four HMRC officers to launch prosecutions being denied by their bosses "due to their complicated nature and a lack of resources".

READ MORE: US Secretly Taped Alleged 9/11 Architect Plotting With Co-Conspirators — Reports

Furthermore, an internal HMRC report cited by the newspaper said that "there are numerous [gang] members involved in think tanks and business forums which bring them into contact with senior British politicians”, with one gang member being seen “shoulder to shoulder with Tony Blair on at least two occasions following the war in Iraq”.

HMRC, however, insisted that the agency “can, has always, and does pass information (within minutes if necessary) to other law enforcement agencies and the intelligence services when dealing with serious crime or terrorism”.

"HMRC takes its critical role in the fight against serious organised crime and terrorism very seriously. We work side-by-side with the intelligence services, law enforcement partners, and across Government, to break up criminal gangs and disrupt terror funding", a HMRC spokesman told the Daily Mail.

*Al-Qaeda is a terrorist organisation outlawed in Russia.