Facing jail: Businessman Seth Pennington, at court earlier this year, today admitted to his involvement in the lucrative counterfeit drugs scam
A counterfeit drugs ring made up to £60,000-a-week selling fake Viagra through a bogus mail-order fishing-tackle business to customers around the world.
The gang, headed by Neil Gilbert, 41, raked in more than £11million offering cheap erectile dysfunction pills and other counterfeit medication.
The group used a series of ‘front’ companies claiming to sell jewellery, fishing tackle and cosmetics to accept the electronic payments and laundered the proceeds through more than 100 bank accounts.
The money was transferred into accounts, both in the UK and overseas, that were held by gang members or their relatives before being withdrawn or used to sustain the business, the court heard.
The court heard that the conspiracy lasted eight years from 2004 onwards and continued even after the gang were arrested in September 2011 following an investigation by an industry watchdog.
Businessman Seth Pennington, 41, today admitted his involvement in the scam – seven other members have already admitted their part.
He went on trial at the Old Bailey, London, in May but the case was aborted after two days when he was hit by a delivery lorry outside court.
Pennington had claimed that his involvement was innocent and believed the products being sold were legal herbal medicines and cosmetics.
But he appeared in the dock this morning to plead guilty to selling or supplying counterfeit Viagra and unauthorised products including Cialis, Super Kamagra and 카마그라젤리 Tadalafil.
Pennington now awaits sentence alongside Gilbert and other members of the ring.
Judge Charles Wide QC granted him conditional bail while a probation report is being prepared but warned him: ‘That is not an indication as to the likely sentence.All options remain open.’
Prosecutor Gillian Jones said: ‘The medicines that were seized which were purported to be Viagra and Valium in fact turned out to be counterfeit.
‘This was big business.The proceeds of the supply of these medicines via websites which have been traced to various merchant facilities is in excess of £11 million – that that is not the real figure.
‘Not all bank accounts have been identified.Some are abroad and haven’t been traced properly and some medicines were paid for in cash.’
An audit kept by Gilbert revealed that the gang received £60,000 a week from the sale of unlicensed medicines during 2011 alone – a turnover of £3million.
Miss Jones said: ‘There is no doubt a conspiracy to sell these unlicensed medicines existed.They had to set up and maintain websites through which medicines were sold, rent storage units and packing centres.
‘Offices were rented, stationary and packaging purchased, mail boxes rented to which customers posted cash and merchant banking facilities to allow payments by cards.
Ring leader: The court heard that Neil Gilbert, pictured earlier this year, was at the heart of the scam
Involved: Catherine Laverick (right) and Sarah Laverick (left) have previously admitted their part in the scheme
‘They purported to be trading fishing tackle, cosmetics or jewellery but they were just a front to hide the real merchandise which was unlicensed medicines.
‘As demand for the products grew the customer database widened to countries in Europe including Sweden, France and Germany.’
When banks started raising concerns about the nature of the business, the gang opened accounts offshore in Belize and Panama where fewer questions were asked.
Hugh Adair, 36, of Ulceby, South Humberside, pictured earlier this year, was also part of the gang
Pennington was involved in the operation of one of the front companies and allowed payments to be made into his bank accounts.
Miss Jones said: ‘He was at the heart of the conspiracy.He was at the beck and call of the head of the conspiracy, Neil Gilbert.
‘He also rented storage facilities for the medicinal products and had access to them. He also carried out stock checks, worked at distribution centres, organised the provision of stationery and money to pay for postage and the stock of unlicensed medicines.
‘He was also involved in selling medicines direct to face to face customers.’
Two of the distribution centres was based in Brighton, the court heard.
Miss Jones said that part of the money laundering operation involved cash being delivered from Humberside to a mailbox rented by Pennington in Brighton.
‘He must have at the very least suspected he was dealing with criminal property.
‘There were repeated credits from customers into all three of his bank accounts, many of which were overseas payments.He also met up with other people involved in money laundering.’
Pennington, of Brighton, admitted conspiracy to sell or supply unlicensed medicines, selling or distributing counterfeit goods (Viagra), two counts of money laundering, one of possession of counterfeit goods purporting to be Valium and one count of possession of a medicinal product (Kamagra) without marketing authorisation.
Neil Gilbert and and Kristina Soufalakis, 26, also of Brighton, Hugh Adair, 36, Catherine Laverick, 46, and Sarah Laverick, 26, all of Ulceby, South Humberside, Mark Bristow, 44, of Crayford, Kent, Darrell Jacob, 37, of Peacehaven, East Sussex, have all previously admitted their part in the scam.
They will be sentenced during a two-day hearing on a date yet to be set.