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Two arrests in fuel fraud raid

Press release   •   Jan 11, 2019 17:30 GMT

Two men have been arrested and a suspected fuel laundering site dismantled as part of an HM Revenue and Customs (HMRC) investigation into what is believed to be a multi-million pound fuel fraud.

HMRC officers, supported by Police Service of Northern Ireland, carried out a search of an industrial address on the outskirts of Newry on Wednesday 9 January.

A suspected distillation-type fuel laundering plant was dismantled and 45,000 litres of fuel seized, along with specialised equipment thought to be being used in the laundering process.

The suspected laundering plant had the potential to produce in excess of 10 million litres of illicit fuel a year, with the potential loss of £6.5 million in revenue.

Steve Tracey, Assistant Director, Fraud Investigation Service, HMRC, said:

“We remain alert to the often dangerous methods criminals use attempting to remove the government markers from rebated fuel and will continue to work with our multi-agency partners to tackle this crime, one we are determined to detect and disrupt.

“Given that laundering plants have been found close to homes and retail sites they have always posed a serious risk to the public. Fuel launderers abandon harmful waste and transport fuel in vehicles that are unfit for purpose and unsafe. We believe criminals are now experimenting with processes that carry a risk of explosion as they seek to defeat fuel markers and I would urge anyone with information about this extremely dangerous activity to report it to HMRC online or contact our Fraud Hotline on 0800 788 887.”

The two men arrested were questioned by HMRC and have been released on bail. Investigations into the fraud are ongoing.

Notes for editors

1.Details of the arrests and seizures in:

  • Two men, aged 23 and 29, were arrested and an industrial premises was searched in the Newry area. At this site, 45,000 litres of fuel was seized, along with six large tanks, one rigid lorry containing a 20,000 litre tank, one transit van, one 40ft fridge trailer, one 40ft curtain side trailer and one private car.

2.HMRC targets fuel laundering as part of its comprehensive and dynamic anti-fraud oils strategy that has driven down the Northern Ireland diesel illicit market share from an estimated 19% in 2005-06 to 6% in 2016-17. The reduction in the illicit market share of GB diesel continues a long-term trend from 5% in 2005-06 to less than 1% in 2016-17.

3.In 2016-17, the illicit market for diesel in NI resulted in an estimated loss of £30 million in duty and a further £10 million in VAT, giving a total loss of £40 million. In GB, the estimated loss is £100 million in duty and a further £50 million in VAT, giving a total loss of £150 million.

4.Laundered fuel is red (or green) diesel, which has historically been filtered through chemicals or acids to remove the Government marker(s). The chemicals and acids remain in the fuel and damage fuel pumps in diesel cars.

5.Distillation-type laundering uses high temperatures in an effort to remove the Accutrace marker from fuel and is a very dangerous process.

6.Although red diesel is predominantly targeted, launderers have also sought to remove the marker from other rebated fuels - especially kerosene - primarily used for heating oil.

7.From 1 April 2015 the UK and Ireland introduced a new fuel marker, which is significantly more resistant to laundering than the existing markers.

8.Anyone with information about people or businesses involved in tax fraud can contact HMRC through the hotline on 0800 788 887 or at www.hmrc.gov.uk/reportingfraud/online.htm

9.HMRC’s Flickr channel: www.flickr.com/hmrcgovuk

10.Follow HMRC's press office on Twitter @HMRCpressoffice

Issued by HM Revenue & Customs Press Office

HM Revenue & Customs (HMRC) is the UK’s tax authority.

HMRC is responsible for making sure that the money is available to fund the UK’s public services and for helping families and individuals with targeted financial support.