Fraudsters try new tactics to lure retailers into buying fraudulent alcohol

Organised criminals are now delivering illicit beer and wine direct to unsuspecting retailers, according to Federation of Wholesale Distributors (FWD) members.

“Beer Van Man” is the latest development in the rise of non-duty paid alcohol sales.

During the past two years FWD members have intercepted hundreds of flyers and emails offering suspiciously-low prices on beer to be collected from premises on industrial estates and back streets. The £500m-a-year duty loss to beer fraud prompted HMRC to launch its consultation into alcohol duty fraud – all trade submissions are now in and responses are being considered.

One London wholesaler said: “The illicit trade is very much moving off the radar in terms of the number of temporary wholesalers springing up. What we’re seeing now is a white van delivery service being offered around. Some stores in our area are even prepared to be out of stock of major brand cans while awaiting delivery, because the price differential between the legal and illegal supply is so great.”

The rise in illegal trading comes as Neilsen figures show that consumers are abandoning supermarket multi-buys and purchasing more beer from local shops. In the 12 months to April 2012 Take home beer volumes fell 8% while impulse sales rose by 4%, but FWD members who supply local stores have not seen a corresponding increase, with volumes down 12% in the first five months of the year.

Last month an HMRC raid on a haulage company in the West Midlands discovered 300,000 litres of suspected non-UK duty paid beer and wine, believed to amount to around £468,000 in unpaid duty.

FWD director of communications David Visick said: “Unfortunately the smugglers have returned with a new approach since the start of the year. We encourage retailers to think twice before accepting any stock from a van which turns up at the door, or a source which only has a phone number. If the price is less than the local cash and carry, if the offer is cash only, or if there’s little or no paperwork, it should ring alarm bells – is this legitimate stock? Buying from criminals not only takes business from your usual wholesale partner, it also puts you at risk of prosecution or losing your licence.

“HMRC is considering marking cans and bottles as UK duty paid, which would make it clear whether the product was legitimate. If the cans were not marked, shops would know not to stock them. However, until this scheme is adopted we encourage retailers to stick with their trusted wholesaler and report any sightings of “Beer Van Man” to the customs hotline, customs.hotline@hmrc.gsi.gov.uk.

The HMRC consultation is now closed and responses are now being considered.

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