A British woman who has been on the run for nearly nine years amid accusations that she laundered ￡1 billion as part of a VAT fraud has been arrested while walking her dogs in Spain.

       Sarah Panitzke, 47, was held in Catalonia on Sunday and is claimed by Spanish authorities to be the only member of a crime gang who remained free, with 16 people already jailed.

       She is accused of laundering money through companies in Spain, Andorra and Dubai for a group that bought mobile phones abroad without VAT and resold them in the UK.

       Panitzke, originally from Fulford, near York, has appeared in a Spanish court and is in custody while extradition proceedings begin, the National Crime Agency (NCA) said.

       She vanished in May 2013 while facing trial for money laundering, and was convicted and sentenced in her absence to eight years in prison.

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       Sarah Panitzke being arrested by Spanish police. (Guardia Civil/PA)

       NCA international deputy director Tom Dowdall said: “Sarah Panitzke has been on the run for almost nine years. Given the length of time, she might have thought we had stopped searching, but she remained on our radar.

       “Joint working between UK law enforcement and our partners in Spain led to her being apprehended, and we will now seek her extradition back to the UK to serve her prison sentence.

       “This should serve as a warning to others on our most wanted list – we will not rest until you are captured, no matter how long it takes.”

       Panitzke had been the subject of a number of most wanted appeals to find fugitives since she vanished.

       Panitzke is led away by officers following her arrest in a small Spanish town on Sunday. (Guardia Civil/PA)

       The Spanish Guardia Civil said she was tracked down to a town near Barcelona in 2015, but she became aware of the police operation to arrest her, so disguised herself and managed to flee.

       In February this year, she was tracked down to the small town of Santa Barbara in Tarragona, which has only around 4,000 inhabitants, and put under surveillance until her arrest.

       Simon York, director of the Fraud Investigation Service, HMRC, said: “Sarah Panitzke was one of Britain’s most wanted tax fugitives.

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       “She played a pivotal role in a multimillion-pound VAT fraud and moved millions through offshore bank accounts.

       “Panitzke thought she had put herself outside of the reach of HMRC, but through our work with UK law enforcement and international partners we have tracked down another tax fugitive. No tax criminal is beyond our reach.”