Subject: [Stop-traffic] News/UK: Gangmasters use illegal workers for pounds 100m tax fraud
From: Melanie Orhant (email@example.com)
Date: Tue Jan 30 2001 - 09:10:27 EST
Gangmasters use illegal workers for pounds 100m tax fraud
By Ian Burrell
The Independent (UK), January 29, 2001
Illegal gangmasters, employing thousands of foreign workers on low wages,
are fleecing the Treasury of pounds 100m a year in unpaid tax, ministers
have been told.
Government research has uncovered a scam involving about 400 illegal
employers who are individually evading up to pounds 5m in tax.
Many of the gangmasters, who recruit teams of cheap labour on behalf of
employers for up to pounds 3 an hour, pay illegal immigrants just pounds 1
an hour and pocket the difference.
Dawn Primarolo, the Paymaster General, said: "Gangmasters are making large
amounts of money through exploiting some extremely vulnerable workers. Our
investigations have shown them pocketing taxes, colluding in benefit fraud
and ignoring health and safety regulations. We will not hesitate to
prosecute these criminals whether they are operating in the agricultural
sector or any other industry."
Customs and Excise and the Ministry of Agriculture, Fisheries and Food have
found that the gangmasters are expanding into other industries. For years,
they have exploited workers at harvest time in the eastern counties of
England and they are now making millions of pounds illegally from the
construction, holiday and tourism, commercial packing and contract cleaning
Maff, which set up an investigation team in Lincolnshire in 1998 when it
began Operation Gangmaster, is to open five more units to cover Lancashire,
the West Midlands, the South Coast, the South-east and the South-west. A
related unit is set to open in Scotland. A Maff report said: "With large
financial rewards at stake, some gangmasters have shown a willingness to
exploit unemployed people from the UK and people from Eastern Europe
seeking work, often illegally, in the UK."
To combat the involvement of gangmasters in other industries Customs and
Excise, working with the Inland Revenue, is to increase its joint shadow
economy teams from five to 20 year. An investigation has begun into
gangmasters working within Asian communities and operating from
Leicestershire to North Wales.
Don Pollard, of the Transport and General Workers' Union, said a range of
employers, from restaurant owners in the Thames Valley to fish packing
companies in Scotland, were turning to gangmasters to supply cheap, often
illegal, foreign workers. "What is needed is a registration scheme for
gangmasters so that they cannot operate without a licence. Until we know
who they are and who works for them we cannot approach this problem."
In the past few months, the authorities have brought a series of
prosecutions against some of the country's leading illegal gangmasters.
Richard Sylvester, from Chesterfield, Derbyshire, is this week facing up to
seven years in jail after admitting what is believed to have been the
biggest fraud of its kind, evading pounds 481,000 in VAT. Scott Richardson,
based in Peterborough,was jailed for four years last August for swindling
pounds 269,000 in VAT payments.
Joyce Quin, an Agriculture minister, described some of the gangmasters as
"illegal and exploitative". She said: "We are determined to step up our
efforts - four gangmasters have been successfully prosecuted since July."
The foreign workers employed by the gangmasters are a mixture of asylum-
seekers, illegal immigrants and students.
Ethnic rivalries spilt over into a mass brawl in an onion field in
Worcestershire last April involving 100 workers from Afghanistan, Pakistan,
India, Poland and Bosnia..
To help foreign workers understand their rights, the Operation Gangmaster
project has circulated 60,000 pamphlets, including 10,000 in Russian and
Polish. In response to the demand for workers, Maff has increased the
number of permitted seasonal agricultural workers from 10,000 to 15,500
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