The Sunday Times - UK (2022-02-06)

The Sunday Times February 6, 2022 15

NEWS

Dubai

7,050 MILES

Skelmersdale

Wigan

Manchester

London

Seaforth docks

I

t was after midnight when Martin

O’Neil woke to the sound of his

French bulldog barking. He left his

partner asleep and went downstairs.

In the kitchen, he found that the

patio door had been removed and

the keys to his £50,000 Mercedes-

Benz E-class were missing. Outside,

a set of car headlights flicked on, shining

through his front door. When O’Neil, 45,

tried to open it, a man on the other side

told him: “If you come outside, I’ll f***ing

kill you.”

From the bedroom window, his part-

ner Rachel, a hospital matron, watched

as two men in balaclavas and hoodies

drove away in their car. She called the

police. They arrived 20 minutes later but

did not catch the thieves.

“These guys were prepared to do any-

thing to get my car,” said O’Neil, who lives

in Greater Manchester. “If I tried to stop

them, I think they would have killed me.”

The two men who broke in were no

ordinary burglars but part of an interna-

tional organised crime gang whose busi-

ness model — stealing expensive cars and

shipping them overseas — was being

financed by taxpayer-funded Covid-

loans.

Last month, as five members of the

gang were jailed for almost 50 years

between them, it emerged that two of

them had been granted £145,000 in

Covid “bounce back” loans. They had

used the money to pay for cars stolen

from all across the UK to be shipped to

the Middle East.

The Treasury has had to write off more

David Collins and Hannah Al-Othman

Gangsters stealing cars to

order from suburban

drives for clients in the

Middle East were aided by

cash from the Treasury’s

pandemic loan scheme

1

In December 2019,

gang member Ibraaz

Shafique sets up a front

company and applies

for a £50,000 Covid

bounce-back loan. He

uses £10,000 of the

cash to pay a shipping

company to transport

cars to the Middle East.^4

Empty 40ft containers

are dropped off at two

sites —Wigan and

Skelmersdale. The

stolen cars, with

headlights, steering

wheel and mirrors

removed to disguise

them, are loaded into

the containers.^5

The containers are

loaded on to a ship bound

for the Middle East, often

at Seaforth docks on

Merseyside. Once at their

destination, the cars are

sold on the black market,

or delivered to a client as

part of the gang’s “steal

to order” service.

Gangs scour the northwest

and London for Range

Rovers, Mercedes-Benzes,

BMWs and Porsches, taking

more than 90 cars. They

force their way into homes

at night to steal the keys

and also use digital devices

to unlock cars on drives.

2

The stolen cars are taken

to one of the gang’s

“chop shop” garages,

often in Greater

Manchester, where they

are dismantled and the

parts sold on the black

market in the UK, or

prepared for shipping to

the Middle East.^3

The Covid cash that fuelled a

CRIME WAVE

12 months. After that, the interest rate

was only 2.5 per cent a year.

About a quarter of UK businesses

applied and the money flowed out

quickly from banks and building socie-

ties. Rishi Sunak, the chancellor, tweeted

on May 9, 2020: “160,000 bounce back

loans worth just under £5 billion

approved in the first three days.”

In hindsight, however, the decision to

issue loans so quickly with “limited cus-

tomer verification and a lower level of

credit checks” left taxpayers “exposed to

a significant fraud risk”, the National

Audit Office (NAO) found.

The scheme, the NAO said, had “prior-

itised one aspect of value for money —

payment speed — over almost all others

and has been prepared to tolerate a

potentially very high level of losses”. The

result was disastrous.

About 1.5 million loans were issued,

worth a total of £47 billion. It is thought

that about £4.3 billion of that has been

lost to fraud — more than the annual

budget of the BBC and roughly £154 for

every household in the country.

“People were flogging limited compa-

nies on social media and eBay,” said a

former drug dealer from Manchester.

“They were just empty companies

you could use to get the bounce-back

loans.

“Companies qualified for the loans if

they were registered before the pan-

demic hit ... [so] all you had to do was

stick £250,000 into one of the companies

and you could get £50,000 of free money.

People were selling hundreds of these

registered companies to people. That

was a good money spinner in itself.”

The scheme closed on March 31 last

year, but the impact on the taxpayer will

be long-lasting. The fraudulent loans not

only crippled the taxpayer but also

fuelled criminal activity that has caused

misery to victims all over the UK.

THE COMPANY

The case of the criminal gang — referred

to as “the Company” in court documents

— behind the theft of O’Neil’s Mercedes is

among the most extraordinary.

Thieves working for the gang stole at

least 95 cars from driveways and from car

rental companies, often in terrifying

circumstances, using “chop shop”

garages to store them or dismantle them

before they were sent out of the country

in containers.

Burglars working for the Company

would enter houses through the back

door — using a trick with a broom handle

to pop patio doors off their hinges — while

parents and children slept upstairs, then

hunt for car keys and other valuables.

The gang is thought to have targeted

specific models as part of a “steal to

order” service they provided to the black

market in the Middle East. Some victims

suspect they were followed to their

homes during the day.

During one burglary in Eccles, Greater

Manchester, in November 2019, the rob-

bers entered the home at 3am, threat-

ened the family and stole the keys to their

Volkswagen Golf-R. Another family was

threatened with a hammer. George

Govotsis, a property developer, was

watching TV when men in balaclavas

stole his £70,000 Range Rover Sport

from the driveway of his £3 million home

in Hampstead, North London. When the

gang struck at 10.57pm on September 4,

2019, Govotsis’s wife, Iftychia, was doing

the laundry and his three daughters, aged

eight to 14, were asleep. Three men

parked outside and used a gadget to

unlock the car.

Govotsis did not know the car had

gone until the following morning, when

he left the house to take his daughter to

school.

The gang’s crimes were not restricted

to burglaries. In one case, members

rammed an Audi in Oldham, Greater

Manchester. When the driver got out to

inspect the damage, he was assaulted and

his car was taken.

It was while at this location that

Shafique, 23, the gang’s unofficial trea-

surer, decided to rip off the Treasury. He

had registered himself as the director of a

company called Merc Car Breakers. The

correspondence address he gave was

Unit 8 Vale Mill, Chadderton — roughly

350 yards from the gang’s first chop shop.

Next, he opened a Lloyds bank

account, describing the business as “buy-

ing damaged cars and car parts from

insurance companies then selling them

through eBay”. The gang would use this

account to pay the cost of shipping its

stolen cars to the Middle East.

A total of £12,765 was paid to KG Logis-

tics to ship containers containing stolen

cars. Court documents show that pay-

ments of £3,975, £3,150 and £2,990, all

made in May and June 2020, were cov-

ered by a lump sum deposit of £50,

into Shafique’s company account — the

proceeds of a fraudulent application by

Shafique for a bounce-back loan.

To spend the money took him only

three weeks. Just over £10,000 went on

shipping costs, while £1,500 was with-

drawn in cash. Another £19,000 was

moved to Shafique’s various personal

accounts, £4,600 was paid out for petrol

and car hire, while £7,500 was paid to Ali.

Shafique also promoted himself as a

sole trader under the trading name

Ibtech Solutions. In May 2020, he opened

another account with Lloyds, telling the

bank he was intending to trade in com-

puting and networking.

Using this account, Shafique made an

application for another loan. It was

approved. Within five days of opening

the bank account, he received £45,000.

If Shafique was the treasurer, Asif

Hussain was the gang’s ringleader. He

had 48 criminal convictions and had

served four years in jail for drug dealing.

Hussain was able to secure £50,

in loan funding for a firm called

German Automotive 365.

The supposed company’s headquar-

ters was a scrap of land around the back

of the Kwik Fit in Wigan. It had never filed

a tax return and there is no sign that it

was registered for VAT. In fact, when The

Sunday Times visited last week, there

was no building at the address, just land

filled with vehicles, skips and timber.

Despite this, Hussain’s application for the

loan was approved.

The judge who sentenced the gang

said the “most basic of checks” would

have revealed the fraud. Shafique was

jailed for five years, Hussain for 15 years.

LOANS FUNDED DRUG GANGS

The Company is far from unique in

using taxpayer cash to fund criminality.

The money was also used by money

launderers, violent drug dealers and sex

traffickers.

Artem Terzyan, 38, from Russia, and

Deivis Grochiatskij, 44, from Lithuania,

were jailed for 33 years in December for

laundering £70 million on behalf of crimi-

nal gangs from around the world, includ-

ing £10 million in bounce-back loans.

Police had witnessed cash being deliv-

ered to the men’s flats in the Docklands

area of east London. Both men were

found to have opened bank accounts in

the names of fake businesses, using them

to deposit tens of thousands of pounds.

Cash was transferred to accounts in

Germany, the UAE, Hong Kong and

Singapore.

The pair were arrested in 2018, but

while on bail they began fraudulently to

claim bounce-back loans for the shell

companies they had set up. They claimed

£50,000 a time, generating £10 million.

They also continued to launder crimi-

nal cash while on bail: between June 2018

and November 2020 they processed

£34 million. Their sentences, which

came after an investigation by the

National Crime Agency, are among the

longest for money laundering in the UK.

Judge Shetty, sentencing the men,

said: “The British taxpayer will be stag-

gered and upset that part of their hard-

earned tax contributions was going into

the pockets of criminals.”

In another case, a cocaine gang used a

company called South Manchester Plas-

tics, a once legitimate business bought by

one of the gang members, to receive a

£35,000 bounce-back loan. It was buying

cocaine at £40,000 a kilogram, selling it

on to dealers and splitting the profits.

The group of Manchester-based crimi-

nals were caught after the National Crime

Agency bugged two portable cabins at

the industrial yard of the plastics com-

pany and listened for several weeks.

The gang were heard discussing a plan

to pose as police officers to carry out a

raid on a businessman’s home in Greater

Manchester, where they expected to find

£500,000 in cash. They also discussed

various torture tactics, including blow-

torching the man’s genitals. Police made

arrests before they could act.

In a third case, police found a network

of five brothels run by a Polish crime

group operating in the south of England

during the pandemic.

The gang posted adverts on adult web-

sites and fraudulently rented properties.

Vulnerable women were forced into sex

work. One said she was forced to have sex

up to 14 times a day. More than 100

women were working in the brothels.

One of the gang members was found by

police to have applied for £90,000 in

bounce-back loans.

VICTIMS LIE AWAKE AT NIGHT

For Martin O’Neil and his partner, the

psychological impact has been long-last-

ing. They have not told their daughter,

now 15, that two burglars entered their

A number of the cars were transported

overseas, some to Dubai, using a Kent-

based shipping firm, KG Logistics.

The money to pay KG Logistics came

from the bounce-back scheme. Police

forensic accountants identified three

payments — totalling more than £10,

— made to KG Logistics. These came from

Covid cash deposited into the bank

account of Ibraaz Shafique, the gang’s

unofficial treasurer. There is no sugges-

tion that KG Logistics was aware of the

scam.

A number of the cars left on ships

bound for Dubai from Seaforth docks,

Merseyside. One container was found

and searched before it left. Another was

tracked to Istanbul, while a third was

returned from the United Arab Emirates.

A year after O’Neil’s car was stolen, he

received a call from a detective. Police

had found his business cards strewn

about in one of the chop shops used by

the Company.

The premises — in a former textile mill

in Chadderton, near Oldham — contained

not only O’Neil’s car but also a Volks-

wagen Polo stolen from a couple who had

been gardening when burglars broke in

and stole their car keys.

Another Mercedes E-class found there

had been stolen from a family in Timper-

ley, an affluent suburb of south Manches-

ter, who were on holiday.

A labourer who worked in the same

industrial estate said: “You’d be fuming,

wouldn’t you? So not only do you get your

car stolen but the taxpayer’s paying for

the car to be sent over there. You’ve just

paid for your own car to be sent to

Dubai.”

DRIVER BEATEN FOR HIS KEYS

The discovery of the gang’s first base in

Chadderton did not stop the Company. A

few months later they rented another

plot, at the back of Kwik Fit in Wigan.

Police were led to the base by the theft

of a Mercedes S-class, worth up to

£70,000, that had been hired from

Europcar at Manchester airport. The car

firm alerted the police, who were able to

track the vehicle’s whereabouts via its

GPS system.

It was at this base in Wigan that Govot-

sis’s Range Rover was found, although it

was missing its engine and gearbox. Sets

of house keys belonging to several family

homes were recovered.

Shafique and fellow gang member

Hadir Ali were arrested at the compound

and questioned. They were released in

September 2019 pending further inquir-

ies.

The pair moved the gang’s operation

to a third location, back in Chadderton,

this time in Vale Mill, another old textile

mill, now divided into industrial units.

Police were led there after the gang

targeted the Audi, which had a tracker

installed. Inside one of the units they

found parts from a Seat Ibiza stolen from

outside a working men’s club in Stock-

port in February 2020. The owner had

been ambushed by gang members and

beaten for his keys.

“I watched the attack on CCTV and it

was awful,” said a bar worker from North

Reddish Working Men’s club. “He was

only young. They pulled up in a car and

surrounded him. He was lucky he wasn’t

killed.”

I watched the

attack. It was

awful. He was

lucky to survive

Asif Hussain, the gang’s ringleader,

and Ibraaz Shafique, its “treasurer”

than £4 billion of taxpayers’ money

handed to fraudsters under the loan

scheme. The scandal prompted the resig-

nation last month of the anti-fraud minis-

ter Lord Agnew, who accused the govern-

ment of “arrogance, indolence and

ignorance” and said it had made “school-

boy errors” in handing out the cash so

freely. He accused the Treasury of having

“little interest in the consequences of

fraud to our society”.

Some of those consequences are now

becoming clear. Not only were billions in

public money wasted, but the loans

caused untold misery by funding scores

of criminals — from drugs gangs and

Russian fraudsters to a Polish gang that

ran brothels in Surrey.

“Doesn’t it just sum up this country at

the moment?” said O’Neil on being told

that his taxes had gone in some small part

towards the theft of his own car and its

transport to Dubai.

“It gets to the point where nothing

shocks you any more. Is nobody checking

what these loans are being spent on?”

FIRMS FLOGGED ON EBAY

When the bounce-back loan scheme was

launched in May 2020 — providing busi-

nesses with the money they needed to

stay afloat during the pandemic — crimi-

nals quickly realised the system was an

opportunity to make easy cash.

Under the scheme, accredited lenders

loaned companies up to £50,000, or a

maximum of 25 per cent of annual turn-

over. The government guaranteed

100 per cent of the loan and there were

no fees or interest to pay for the first

home to steal the car keys. She was stay-

ing at another relative’s house the night

the family home was broken into.

“You don’t think it’s going to happen to

you,” O’Neil said. “You think that sort of

thing only happens in a soap on TV.

“You try to protect what is yours, don’t

you? We’ve worked hard for what we’ve

got. We pay our taxes and national insur-

ance. Rachel is a nurse. She helps people

every single day. It does go through your

mind: what if they tried to come upstairs?

I would have had to protect my family, no

question.

“Now I lie in bed at night and sit up

whenever I hear a creak on the stairs or

any sort of noise. We’ve changed all the

locks. Got extra cameras. But you’re

never going to stop them. If they want

your car, they’ll get in your house. But

using taxpayer’s money to then ship

them out to the Middle East — that just

shows the brass neck of these people.”

The five men convicted last month

were responsible for the conspiracy to

steal and export the cars, but the robbers

and burglars have not yet been caught.

The other gang members were

Ali, who was sentenced to 11 years, Saijid

Jangharia (ten years) and Tayub Hasnain

(five years and six months).

Greater Manchester police refused to

comment on the case ahead of a linked

trial due to start this month.

KG Logistics, which acts as a booking

agent for the shipping line, said it had “no

idea that this type of criminal activity was

being done”. It said: “If KG Logistics ship

any vehicles, we will always make sure

before booking that we obtain the vehicle

details, make, model.”

@DavidCollinsST

The Sunday Times February 6, 2022 15

INVESTIGATION

RICHARD GARDNER/SHUTTERSTOCK

An associate of money launderers Artem Terzyan and Deivis Grochiatskij