Birmingham businessman begins jail term for illegal red diesel scam

10 Jul 2006 02:45 PM

A Birmingham businessman pleaded guilty and was sentenced to a total of three years and nine months in prison at Birmingham Crown Court on Thursday, 6 July, following the repeated illegal use of red diesel, resulting in evasion of excise duty of over £275,000.

Robert William James, 45, had been involved in the running of haulage companies either jointly or independently from 152 Amington Road, Tyseley, Birmingham. Between May 2000 and May 2004 he was engaged in the large scale and systematic misuse of rebated diesel as fuel in his vehicles.

Nick Burriss, Assistant Chief Investigating Officer for HM Revenue & Customs (HMRC), said: "This successful conviction is the culmination of our strenuous efforts to crackdown on the illegal use of fuels. This was a planned and sustained act of criminality which would have robbed the Treasury of many thousands of pounds and deprived investment into providing vital public services."

He added: "I hope this serves as a stern warning to others that we will take every action possible to win the war on crime and bring those to justice for the wider benefit of the whole community."

James had previously been released early from prison on licence for excise evasion relating to the importation of tobacco products in 2000. He had been sentenced to 3 years imprisonment. He had also been previously sentenced to 21 months for a similar offence dating from 1999.

In summing up Judge Gregory, said: "While still serving a prison sentence, albeit on licence, James started to buy red diesel for his haulage business in the full knowledge of what he was doing. This was a most deliberate and pre-meditated fraud with the aim of further profiting from this illegal activity."

On 18 May 2004, HMRC Road Fuel Testing Officers attended the business premises of WM Transport, 152 Amington Road, Tyseley, Birmingham. Four vehicles were seized after testing positive for red diesel. A bulk tank found on site was also tested and found to contain red diesel.

Robert James was arrested, on suspicion of the fraudulent evasion of excise duties through the misuse of red diesel. The arrest took place at his home address

A further vehicle at the home address was also seized after testing positive to red diesel.

Enquiries at eight different legitimate oils suppliers about their supplies to James revealed the use of false company names, VAT numbers, various aliases and the large scale purchases of rebated oils. JAMES was declared to have benefited from his criminal activities by more than £785,115.80.

HMRC has also been successful in securing a Confiscation Order under the Criminal Justice Act 1988. Assets valued at £285,416.29 will now be seized. The judge ordered that James serve a default sentence of five years imprisonment, to run concurrently, if the sum is not paid within 12 months.

Notes for editors

* Robert William James, of 101 Hampton Lane, Solihull, West Midlands, was sentenced to two years in prison. In addition he will serve a further 607 days, consecutively, not previously served for tax evasion.

* On 29 July 2005 James pleaded guilty to the second of two charges - Evasion of Excise duty Payable on Hydrocarbon Oil under S6 Hydrocarbon Oils duties Act 1979.

* Red diesel is much cheaper than diesel at the forecourt as it carries a reduced rate of excise duty. It contains a red dye which makes illegal use easier to detect. All off road vehicles (including trains) are currently eligible to use red diesel. Only vehicles such as agricultural tractors, combine harvesters, and materials handlers are entitled to use it on the highway.

* The Revenue & Customs Prosecutions Office (RCPO) was created by Royal Assent on 18 April 2005. An independent prosecuting authority, RCPO reports directly to the Attorney General, and is responsible for prosecuting some of the largest drug and fraud cases in the UK. For further information about RCPO, please contact their press office on 020 7865 5666.

* Anyone with information relating to smuggled goods should contact HMRC's confidential hotline number on 0800 59 5000 or email: customs.confidential@hmrc.gsi.gov.uk

Issued by HM Revenue & Customs Press Office

Website www.hmrc.gov.uk