A judge called for a “full investigation” after investigators discovered that a criminal drug gang had received Â£ 25,000 from government as a coronavirus “rebound” loan.
Gary Betts, 57, Gerard Boyle, 57, John and Chris Sammon, 32 and 35, and Wayne Simmonds, 39, had previously admitted to being part of a conspiracy to supply cocaine.
They appeared before a judge over a plan to target the wealthy 80-year-old man by carrying out a mock police raid and stealing money, luxury cars and jewelry that are believed to be kept in his home.
A jury heard how Manchester criminals Betts, Boyle and the Sammon brothers had established a hideout at ‘South Manchester Plastics’, a once legitimate business on Gorton Road in Openshaw.
After the property was transferred to Boyle and the others, it became “a front for crime,” Judge Anthony Cross QC told the court.
In fact, investigations later revealed that the only significant payment entering or leaving South Manchester Plastics’ accounts was a Â£ 25,000 ‘rebound’ loan from the government, a jury said.
Meanwhile, the gang would buy cocaine for Â£ 40,000 a kilo, sell it to drug dealers and share the profits.
Unbeknownst to the gang, the National Crime Agency had bugged two portable booths in the industrial yard and listened to them for several weeks as they discussed their criminal activities.
And the investigation took an even more sinister turn when Betts told the gang he had a “good job” that would bring them “a lot of money.”
It was a question of posing as police officers to carry out a fake raid on the home of the businessman in Greater Manchester.
They expected him to hide up to Â£ 500,000 in cash on the property and discussed torture tactics including using a blowtorch on the victim’s testicles, cutting off his ear and holding an iron to his chest to charge him.
When the gang appeared to have given the green light for the raid to take place on the May Bank Holiday weekend of last year, the NCA moved in.
The five men were found guilty after a trial, while a sixth, William Skillen, has pleaded guilty to the drug charges and has now been sentenced to a combined total of more than 130 years in prison.
After his conviction, Judge Cross made a number of observations.
He reminded the court how during the trial it emerged that on May 6, 2020, the government granted Gerry Boyle a Â£ 25,000 ‘rebound’ loan for the coronavirus for South Manchester Plastics (SMC) despite his lack of legitimacy.
Upon opening the case, prosecutors told the jury: “SMC was incorporated in February 2019, the only director was Gerrard Boyle, it appears he was nominally responsible, but as you will hear all defendants based in Manchester , Betts, Boyle and the Sammons, appear to have been equally responsible and equally responsible for what happened there.
âSMC was theoretically a plastics recycling company, but as you won’t hear from the company or Boyle, the company director never applied for or received any permits or approvals from the Agency for it. environment to accept, sort, store or transport any type of waste. .
“They were not and have never been registered as carriers of waste.”
âDuring the entire time that the company was under observation, NCA agents saw no legitimate trade, there was no plastic at the site when the NCA raided on May 11, 2020 and the company no. ‘ve never filed income tax returns of any kind.
“While there was money in the accounts, the largest amount paid out was a Â£ 25,000 government rebound loan given to support businesses during the coronavirus pandemic.”
Judge Cross said the proceedings are now over, he wanted to know how Boyle was able to get the rebound loan.
“This case was a pretext and a full investigation should be carried out on the person who granted this loan to an organized criminal group,” he said.
âI expect to receive a written explanation within fourteen days. “
The ‘rebound’ loan scheme was launched by the government on April 27, 2020 to help small and medium-sized businesses borrow between Â£ 2,000 and up to 25% of their turnover.
The maximum loan available was Â£ 50,000.
The government guaranteed 100% of the loan and there was no charge or interest payable for the first 12 months.
Applications closed on March 31, 2021, and the program turned out to be much more popular than expected.
Last October, a National Audit Office (NAO) report said the program would lend between Â£ 38bn to Â£ 48bn by November 4, “significantly exceeding” the Â£ 18bn to 26bn assumed when it was launched. .
A third party review found that while some risks could be mitigated, there remained a “very high” level of fraud risk, caused by self-certification, multiple claims, lack of legitimate business, spoofing. identity and organized crime.
The Cabinet Office’s government fraud function estimates that losses due to fraud are likely to be significantly higher than the 0.5 to 5 percent that is generally estimated for public sector programs.
Due to credit and fraud risks, the Department for Business, Energy & Industrial Strategy (BEIS) and the British Business Bank have estimated that 35 to 60% of borrowers could default on their loans.
Gareth Davies, head of the NAO, said at the time: âFearing that many small businesses are running out of money due to the COVID-19 pandemic, the government has acted decisively to save money. into their hands as quickly as possible.
âUnfortunately, the cost to the taxpayer can be very high if the estimated losses turn out to be correct.
âThe government will need to ensure that strong debt collection and fraud investigation arrangements are in place to minimize the impact of these potential losses on public funds.
“He should also take this opportunity to now consider the controls he would put in place to protect himself against the abuse of any future plan of this type.”