13 sentenced in £8.5m counterfeit tobacco conspiracy

A 13-STRONG criminal gang have been sentenced for plotting to steal £8.5m of taxpayers’ money in a counterfeit tobacco manufacturing conspiracy based out of the West Midlands.

The ten men and three women, led by Phillip Hall, imported raw leaf tobacco as well as tobacco cutting and shredding machines. They set up tobacco manufacturing plants across the West Midlands to produce counterfeit hand rolling tobacco using the name of a well known brand on sale across the UK.

Gary Lampon, assistant director of criminal investigation for HMRC, said: “This was a well organised international crime gang that we have disrupted and brought before the courts. Masterminded by career criminal Phillip Hall, currently in jail for similar offences, the smuggling plot operated on a commercial scale, both in its organisation of capital and its workforce.

“They had no regard for the money they stole from public finances and honest taxpayers, which has been substantial. We are determined to bring those involved in this form of criminality before the courts so justice can be served.”

Hall was a pivotal figure in the fraud, arranging importation of machinery and tobacco and deciding what to buy and when. He negotiated with foreign suppliers and set the price for the sale of fake tobacco pouches on UK streets. He also created proxy businesses to conceal the scale of the fraud and the role he and his gang members played.

The size of the operation came to light when HMRC officers seized and broke up five tobacco manufacturing plants and one storage facility in the Midlands including: Willenhall Street, Wednesbury; Ashmore Lake Way, Willenhall; Homer Industrial Park, Macrome Road, Wolverhampton; Dormston Trading Estate, Burton Road East, Dudley; and a barn off Lychgate Lane, Aston Flamville, Leicestershire. A tobacco cutting and shredding machine was also found at a freight company premises rented by the gang at Felixstowe.

All were charged with offences under the Customs and Excise Management Act 1979 and the Criminal law Act 1977. Sentencing took place at Nottingham Crown Court.

Phillip William Hall, 52, currently of HM Prison Service and formerly of Ruskin Road, Wolverhampton, Oberon Grove, Wednesbury, and Highland Way, Rugeley, pleaded guilty and was sentenced to two years in prison to run concurrently. Hall was previously jailed for five years in March 2011 and for 18 months in January 2012 for similar offences.

Also sentenced were:

•    Thomas Connors, 35, of Showel Road, Bushbury and Fourth Avenue, Low Hill, Wolverhampton, was found guilty and sentenced to three and a half years in prison. The court was told Connors arranged premises for the production of the tobacco and hiring vehicles to collect the tobacco on its arrival in the UK.

•    John O’Brien, 66, of Fifth Avenue, Wolverhampton, pleaded guilty and was sentenced to two years and two months in prison. O’Brien arranged premises for the production of the tobacco and would collect the imported tobacco from hauliers’ depots. O’Brien was previously jailed for one year in 2006 for similar offences.
    
•    Kelly Ann Sowden, 29, of Wolverhampton Street, Wednesbury, pleaded guilty and was sentenced to three month in prison, suspended for 12 months, and ordered to carry out 120 hours of unpaid work. Sowden was a packer for the counterfeit tobacco pouches, was a co-signee on paperwork for machinery and helped to buy tobacco machinery.

•    Donald James, 64, of Meschines Street, Coventry, pleaded guilty and
was sentenced to 12 months in prison, suspended for 12 months, and a six-month home curfew. James had a senior role in the conspiracy, working alongside Hall, with an overview of activities and direct input into decision-making. He previously received a 12-months suspended prison sentence in January 2012 for similar offences.

•    Vicky Sarah Hall, 27, of Thornthwaite Close, Rubery, was found guilty and sentenced to three months in prison, suspended for 18 months. The court was told she allowed her bank accounts to be used for the fraud.

•    Joy Richards, 51, of Oberon Grove, Wednesbury, pleaded guilty and was sentenced to eight months in prison, suspended for 18 months, and ordered to carry out 120 hours of unpaid work. She opened bank accounts and used existing accounts to make payments to Italy for the tobacco and her former home was used to prepare and fill pouches of counterfeit Golden Virginia tobacco.

•    James Patrick Richards, 20, of Oberon Grove, Wednesbury, pleaded guilty and was sentenced to carry out 80 hours of unpaid work. Richards helped in the production process of counterfeit Golden Virginia tobacco.

•    Michael Panayi, 56, of Buzzard Close, Broughton Astley, Leicestershire, pleaded guilty and was sentenced to nine months in prison, suspended for 18 months, and ordered to carry out 120 hours of unpaid work. Panayi provided the use of the barn to store a tobacco shredder and tobacco and helped with concealing machinery.

•    Orrett Hyman, 57, of Ross Mill Cottage, Rodley Lane, Leeds, was found guilty and sentenced to 21 months in prison, suspended for 18 months, and ordered to carry out 240 hours of unpaid work.  Hyman purchased and imported tobacco shredding machines and purchasing tobacco from Italy.

•    Simon John Howard, 45, of Hornchurch, Essex, was found guilty and was sentenced to 21 months in prison, suspended for 18 months, and ordered to carry out 240 hours of unpaid work and abide by a six-month home curfew. Howard purchased and imported tobacco shredding machines from Russia and facilitated the purchase of tobacco.

•    Paul Percival, 52, of Springfield, Chelmsford, was found guilty and sentenced to 21 months in prison, suspended for 18 months, and ordered to carry out 240 hours of unpaid work and abide by a six-month home curfew. He purchased and imported tobacco shredding machines from Russia and facilitated the purchase of tobacco.

•    Graham David Whitehouse, 45, of no fixed address pleaded guilty and was sentenced to nine months in prison, suspended for 18 months. Whitehouse liaised with the landlord of premises rented for the tobacco production facility and prepared pouches of counterfeit tobacco.