The plot, worth over £131 million per annum in lost revenue, was foiled when HM Revenue & Customs criminal investigators swooped and closed down the fully equipped cigarette factory in Chesterfield, Derbyshire, before it went into production. During the raid in September 2009 they discovered that the gang were also planning to expand into making counterfeit alcohol.
In two co-ordinated searches at the gang's other industrial units in Blidworth, Nottinghamshire, and a barn at Top Farm, Laxton, Newark, Nottinghamshire, the investigators also seized:
- Cigarette manufacturing equipment destined for another criminal gang, capable of producing a potential 750 million cigarettes a year with an annual revenue loss of over £141 million, from Blidworth, and
- A five tonne tobacco cutting machine to process the tobacco to make counterfeit hand rolling tobacco and cigarettes, from Laxton.
Gary Lampon, Assistant Director of Criminal Investigation for HMRC, said:
"This was organised crime on an industrial scale. The gang planned to launch a UK production facility, manufacturing counterfeit tobacco goods by the million. We had previously seized 1.25 million illegal cigarettes from them, so in the belief that they could make a bigger profit, they decided to make their own. This was all about lining their own pockets and they had no regard to the potential harm such criminal activity causes to individuals, communities and legitimate businesses."
His Honour Judge Jonathon Teare said "the potential loss of revenue was substantial; the project was grand with a series of plans set to evade duty and make millions". On sentencing Robinson, he said, "your expectations were high and if you had succeeded you would be a millionaire by now and the public purse very much depleted".
Gang members traded in smuggled and counterfeit cigarettes illegally manufactured in the UK. HMRC had already seized 1.25 million cigarettes from the gang in two separate operations. The first in June 2009, when one million cigarettes were seized in Rainworth, Nottingham, and the second in August 2009 when 250,000 cigarettes were seized at the Sherwood Business Park, Nottingham.
The gang had conspired to escalate from trading in these illegal cigarettes and tobacco, to manufacturing their own counterfeit cigarettes and tobacco on an industrial scale. Unbeknown to the gang, HMRC were aware of their elaborate plans and were secretly tracking their every move, swooping once they were confident they had enough evidence to bring the defendants to justice, but before the manufacturing plants went into production.
At the Chesterfield plant officers also seized packaging for 43 million cigarettes, cigarette paper and cigarette tipping paper, foil cellophane, glue and cardboard inners for packets of 20 cigarettes.
In Blidworth, 5,000 litres of 96 per cent proof alcohol was seized in a lorry just yards before it was delivered to the gang's warehouse. This was enough to produce 25,000 bottles of spirits such as vodka or whisky, with a revenue loss of £109,000.
Forensic analysis showed the liquid was denatured alcohol unfit for human consumption.
At the barn in Laxton officers also seized 100,000 counterfeit Golden Virginia pouches.
Notes to Editors
1. Pictures of the defendants, moving footage and still photographs of the counterfeit tobacco manufacturing plant are available on request.
2. Details of the defendants sentenced today, 31 January 2012 at Nottingham Crown Court include
- Phillip William Robinson, (DOB 25.02.65), of 3 Southfields Close, Kirkby in Ashfield, Nottinghamshire, was sentenced to seven years and four months in prison. A five year crime prevention order was also granted.
- Robinson was the principal player in the fraud heading up the tobacco manufacturing plant and running the UK
arm of the operation. He was also responsible for organising the illicit alcohol plot.
- Derek Lloyd Hickling, (DOB 29.12.64), of 278 Woodborough Road, Nottingham, was sentenced to twelve months in prison suspended for twelve months. He is also required to carry out 120 hours of unpaid work.
- Hickling played a role in the alcohol supply chain.
- Michael Roy Larcombe, (DOB 23.04.54), of 66 Meadowside Crescent, Nottingham, was sentenced to twelve months in prison suspended for twelve months. He is also required to carry out 120 hours of unpaid work.
- Larcombe was the driver responsible for transporting the 5,000 litres of illegal alcohol seized.
- Vincent Waller, (DOB 01.12.64), of 10 Jubilee Crescent, Clowne, Chesterfield, Derbyshire, was sentenced to two years and six months in prison. A four year crime prevention order was also granted.
- Waller was Robinson's right hand man and oversaw the setting up of the machinery and sourced the commercial premises.
- Peter Bent, (DOB 09.10.67), of 73 George Street, South Normanton, Alfreton, Derbyshire, was sentenced to ten months in prison suspended for one year. A curfew from 9pm - 6am for four months was imposed.
- Bent acted as a broker in the cigarette smuggling operation and was to partner Robinson in the illicit alcohol plot.
- Phillip William Hall, (DOB 22.01.61), currently of HM Prison Service and formerly of 5 Highland Way, Rugeley, Staffordshire, and 26 Oberon Grove, Wednesbury, West Midlands, was sentenced to 18 months in prison.
- Hall (along with co-defendant James) was to be the supplier of the tobacco and instruct how to operate the tobacco manufacturing machinery.
- Hall was jailed for five years in March 2011 for his role in operating an illegal tobacco manufacturing plant in Blithbury, Staffordshire.
- Donald James, (DOB 14.03.49), of 51 Meschines Street, Coventry, West Midlands, was sentenced to 12 months in prison suspended for one year. A curfew from 9pm - 6am for four months was imposed. A three year crime prevention order was also granted.
- James (along with co-defendant Hall) was to be the supplier of the tobacco and instruct how to operate the tobacco manufacturing machinery.
- Christopher John Burns, (13.07.77), of 3 Leigh Ave, Burntwood, Staffordshire, was sentenced to 16 months in prison. A three year crime prevention order was also granted.
- Burns arranged the transportation of smuggled tobacco and would have played a role in commercially selling the counterfeit goods across the UK.
- Andrius Kochanauskas, (DOB 01.02.82), of Ozuku, 37-1, Vilnius, Lithuania, was sentenced to five months in prison.
- Kochanauskas was taking control of the second tobacco manufacturing machinery for a separate organised crime gang.
- Dangis Sulzinskas, (DOB 23.01.71), Flat 4, Nelson House, Western Avenue, London, was sentenced to 12 months in prison suspended for 1 year. He is also required to carry out 180 hours of unpaid work.
- Sulzinskas was a driver and a supplier of smuggled cigarettes.
3. The defendants were charged with either tobacco or alcohol smuggling offences under the Customs and Excise and Management Act 1979 or conspiracy to produce cigarettes and / or hand rolling tobacco within the UK contrary to the Criminal Law Act 1977 and Customs and Excise Management Act 1979.
4. Follow HMRC on Twitter @HMRCgovuk
Source: Issued by HM Revenue & Customs Press Office