HM Customs Press Release ********************
Cigarette Smuggling Gang Sentenced
A Kent based smuggling gang, who traded an estimated 78 million cigarettes and evaded around £18 million in excise duty, were jailed for a total of six and a half years today (12 June 2009).
Christopher Osborne was sentenced to four and a half years, his son Jack Osborne was jailed for one year and Christopher Edwards of Surrey also received a one year sentence. Londoner, Clive Evans received an eight month sentence, suspended for two years, plus a three month overnight curfew. Christopher Osborne's wife, Stephanie Osborne received a 12 month sentence, suspended for two years. She must also complete 200 hours community service.
The five were sentenced at Isleworth Crown Court for offences relating to the evasion of excise duty and money laundering.
HM Revenue & Customs (HMRC) criminal investigators had some of the gang under surveillance. Officers caught Christopher Osborne (49) and his son Jack Osborne (23) with 2.1 million illegally imported counterfeit cigarettes at a lock-up in Leytonstone, East London on 3 May 2008. The huge haul was seized and the men were arrested.
As officers raided the premises a large quantity of the cigarettes was being loaded into a van. Its occupants Christopher Edwards (63) and Clive Evans (45) had driven from Surrey to purchase and collect cigarettes. Officers discovered a carrier bag containing £79,980 in cash concealed under the passenger seat, which was payment for the goods. Both men were arrested.
HMRC investigators and the Revenue and Customs Prosecutions Office (RCPO) were able to establish that the seizure was not a one-off supply of cigarettes. Paperwork recovered from the lock-up led investigators to a legitimate packaging supply company. Officers established from them that Christopher Osborne, using the alias Ray Hay, had purchased a total of 4,780 cardboard boxes, and a large quantity of parcel tape, from the company on 19 separate occasions between 2 November 2007 and 29 April 2008. All 'Ray Hay's' packaging purchases were in cash.
Based upon the number of boxes purchased in that six month period alone it is estimated that around 78 million cigarettes passed through the organisation. The estimated loss of duty is around £18 million.
Christopher Osborne had made a significant amount of money in relation to the importation, distribution and supply of smuggled cigarettes over a number of years. Within days of his arrest he and his wife Stephanie Osborne (47) transferred substantial assets (valued at in excess of £50,000) from joint bank accounts into accounts solely in her name, to avoid confiscation.
An initial search of the Osborne family home in Bromley uncovered £7,000 cash in Jack Osborne's bedroom. In a later search, assisted by 'Sniff' a cash detection dog, £20,000 was found hidden beneath a chest of drawers and £199,700 was discovered in two holdalls, hidden behind a tool box in the garage.
Money laundering investigations show that cash deposits, exceeding £250,000, were paid into bank accounts from March 2003. This cash is believed to be the proceeds of crime.
Andrew Pavlinic, HMRC Assistant Director Criminal Investigation, said:
"HMRC investigators have dismantled a prolific cigarette smuggling gang, preventing large quantities of unlicensed and unregulated counterfeit tobacco from reaching the UK's streets. These criminals have lived a lifestyle funded by the proceeds of crime and we will work closely with our prosecutors to confiscate illegally funded assets.
"Tobacco smugglers don't care about undercutting honest retailers and tobacconists - All criminals care about is profit. Anyone with information about illegal smuggling activities should call the Customs' Hotline on 0800 59 5000."
His Honour Judge McGregor-Johnson said:
"This was a professional conspiracy. Christopher Osborne was involved in laundering large sums of money through his bank account."
The total amount of duty evaded on the 2.1 million cigarettes seized at the lock-up is around £430,000.
The cash seized from the van and at the Osborne family home has been confiscated under the Proceeds of Crime Act. Confiscation proceedings on other assets will be pursued at a later date.