A criminal gang
has been jailed for one of the biggest ever alcohol smuggling
frauds ever uncovered in the UK. The scam was worth £50m a year in
unpaid duty and VAT and allowed the gang members to spend
recklessly on high performance cars and luxury properties
throughout Europe.
Gang ringleader Kevin Burrage, 49, owned Promptstock Ltd, a
bonded warehouse in Essex. His brother-in-law, Gary Clark, 55,
managed the warehouse which the pair used to import and export
alcohol without paying a penny in tax.
The gang bought household branded beer, wine and spirits from
bonded warehouses in France and imported it duty free into the UK,
destined for Promptstock. Once safely through customs, the alcohol
was illegally diverted to locations around the UK where it was
sold on without duty being added.
The gang also reversed the fraud by appearing to send trucks to
France loaded with non duty paid alcohol. The alcohol actually
remained in the UK and was sold on, again with no tax added. To
avoid detection, the gang sent empty trucks to the continent,
several of which were intercepted by UKBA officers.
Accomplice Michael Turner owned Keytrades (Europe) Ltd which
provided a seemingly legitimate cover for movements of the alcohol
consignments. Davinder Singh Dhaliwal operated as Burrage’s right
hand man, organising the delivery of large quantities of alcohol
ready for distribution. Following a covert surveillance operation,
the gang was arrested in a series of dawn raids by HMRC officers
in November 2008.
Martin Brown, Assistant Director of Criminal investigation, HM
Revenue & Customs said:
“This gang was interested in
nothing further than lining their own pockets at the expense of
honest taxpayers. HMRC will not stand by and let criminals rip off
the law abiding public. We are committed to protecting public
finances from attacks by organised crime, and the extra £917
million invested in HMRC will help us step up this fight. Crooks
like this should beware: HMRC will find you, and you will have
your day in court.”
Confiscation proceedings are underway.
Notes to Editors
1. Kevin Ramon Burrage DOB 17/07/1962 of 9 Ravendale Way,
Shoeburyness, Southend on Sea, Essex SS3 8YA; was found guilty of
conspiracy to cheat the Public Revenue and sentenced to 10 years
imprisonment as well as being disqualified from being a director
for 12 years.
2. Gary Dennis Clarke DOB 16/10/1956 of 274 Maplin Way North,
Thorpe Bay, Southend on Sea, Essex SS1 3NT was found guilty of
conspiracy to cheat the Public Revenue and sentenced to six years,
nine months
3. Michael Brian Turner DOB 29/07/1959 of Flat 9 Merchants
Place, Rendezvous Street, Folkestone, Kent CT20 1ET pleaded guilty
at an earlier hearing to cheating the Public Revenue and
fraudulent evasion of excise duty and was sentenced to three
years, two months
4. Davinder Singh Dhaliwal DOB 26/11/1979 of 11 Langdale
Gardens, Dartford, Kent DA1 2QB pleaded guilty at an earlier
hearing to cheating the Public Revenue and fraudulent evasion of
excise duty and was sentenced to 16 months.
5. The movement of duty suspended alcohol is controlled by
HMRC and foreign Customs Authorities. Alcohol can be stored and
moved between bonded warehouses within the EU without the payment
of excise duties. Once the business needs to release the alcohol
to retail outlets the excise duty becomes payable at the rates
applicable in the host country. Therefore UK duty was due as soon
as the alcohol was diverted from the UK bonded warehouse to the UK
market.
6. Examples of the types of scams that the gang operated:
- Inbound diversion: A vehicle loaded with vodka arrived in
the UK for delivery to the Promptstock bonded warehouse; it was
diverted to an industrial unit in Hayes, Middlesex, for
distribution in the UK, without the duty being paid. Dhaliwal was
observed supervising the offloading of the vodka into the unit.
The goods were seized by HMRC officers.
- Outbound diversion: An empty trailer was sent to France;
the beer (instead of arriving in a foreign bonded warehouse) was
found by HMRC officers at premises in Leicester complete with
orange rotation stickers stuck on at Promptstock’s premises. A
total of 30,472.7 litres of alcohol was seized with a UK excise
duty value of £21,626.89.
7. One of the haulage companies involved in the fraud, Stag
Freight, was owned by John Byrne, and run by Terry Ward the
transport manager. They were convicted of cheating the Public
Revenue and jailed for 7 years each on 26 August 2011.
8. Follow HMRC on Twitter @HMRCgovuk.
Website www.hmrc.gov.uk
Contacts:
HM Revenue & Customs Press Office
HMRC-Press-office.NDSmanagement@hmrc.gsi.gov.uk