After a blow by the British authorities against an enormous counterfeiting syndicate in the UK, the head of the group and an accomplice have now been found guilty in early April following a 14‑day trial. The group had imported and sold counterfeit designer clothes with an original value of at least 50 million pounds (approx. 58 million euros). They had also tried to scam almost 100 million pounds (approx. 115 million euros) through VAT fraud.
The convicted counterfeiting boss, sock manufacturer Arif Patel, had been dealing in fake designer clothing, according to the officials: Through a company based in Preston, Lancashire, in northern England, he and his accomplices had coordinated the import of counterfeit clothing and fraudulent export business. Mohamed Jaffar Ali, who was convicted together with Patel and who had among others been found guilty of money laundering just like Patel, had laundered the profits through accounts in Dubai and offshore. First massive imports of counterfeit clothes date back to 2004. In the following three years, dozens of containers with counterfeit designer clothes were repeatedly stopped in UK ports – for example in Liverpool, Southampton, and Felixstowe. The group had also resold counterfeit goods to UK traders, as was confirmed by a shipment intercepted by police on its way to a wholesaler in Glasgow.
In addition, Patel had carried out so-called tax carousel fraud (for schemes within the EU, this is sometimes also called Missing Trader Intra-Community (MTIC) fraud). With this, the group had made millions by fabricating sales and exports of textiles and mobile phones – and making fraudulent VAT repayment claims on them. In total, the gang claimed 97 million pounds (approx. 112 million euros) for false exports, of which HM Revenue & Customs (HMRC) was able to stop 64 million pounds (about 74 million euros). In addition, 78 million pounds (ca. 90 million euros) of the counterfeiting ring’s assets were seized by HMRC and are now to be returned to public funds.
After existing reporting restrictions on the case have now been lifted too, it became known that between 2011 and 2014, 24 members of the gang had already been found guilty and sentenced to a combined total of over 115 years in prison. Arif Patel, who now lives in Dubai, was in Dubai at the time of his trial. He was found guilty in his absence on 11 April and is now to be sentenced in May.
