Five men - four of them employees - took part in an organised fire detection systems fraud which made big money off the back of a reputable firm and could have put lives at risk, a court was told.
Burnley Crown Court heard how the three-part, three-company, con targeted the well-known and highly-regarded Protec plc, whose head office is at Lomeshaye, Nelson, and which designs, supplies and implements often complex fire alarm and detection systems. The firm was hit to the tune of at least £155,000.
Also cheated were ADS (Lancashire ) Ltd, an electrical engineering firm, and large scale property developers Mandale Commercial Ltd, who thought they were getting genuine, new Protec systems.
What they actually did get installed, at numerous sites, were parts which had been stolen from Protec by crooked workers betraying their bosses. Some equipment was second hand and redundant and had been salvaged from sites and installed as new. The systems were fraudulently commissioned with fake commissioning certificates - passed off as meeting mandatory safety requirements - by two Protec employees and put in high risk premises such as accommodation for hundreds of students.
The hearing was told the main man in the plot was Simon Tipping, an electrical engineer and Protec subcontractor, who was involved in all three parts and was out for maximum profit. He often dishonestly got work by rewarding “trusted” Protec contract managers Jonathan Petrie and Robert Robertson with back handers of money or free holidays. Robertson had £2,500 worth of family breaks paid for by Tipping’s company.
The hearing was told Petrie, who had worked at Protec 18 years, was said to have played a vital central role in the fraud. Protec workers John Fairbairn and Darren Scholes, who had been employed there since he was 18, were also involved and all defendants played important parts in their differing ways. The scam came to light by chance after a stolen unit installed by Tipping started to malfunction and investigations started.
Tipping (45), of Brownedge Road, Bamber Bridge, Scholes (31), of Blandford Drive, Manchester, Fairbairn (58), of Holly Crescent, Sowerby Bridge, West Yorkshire, Roberston (58), of Burnsall Close, Burnley and Petrie (46), of Hill Crescent, Heywood, had admitted conspiracy to defraud, between April 1st, 2005 and August 31st, 2008. None had previous convictions and a proceeds of crime hearing will be held.
Tipping was jailed for three years, Petrie for two years and Scholes for 12 months. Sentencing, Judge Beverley Lunt told Tipping: “You are at the heart of it. The others are all here because you have corrupted them either directly or through Petrie.” She added Tipping’s actions were a gross breach of trust and he knew there could have been serious repercussions.
Judge Lunt told the trio: “All three of you were driven by greed. All three of you must now take the consequences.”
Fairbairn got 24 weeks in prison, suspended for a year, with 80 hours unpaid work. Robertson received a 12- month community order with 80 hours unpaid work.
Mr Roderick Priestley (prosecuting) said Tipping ran SRT (Electrical) Ltd, which he wound up in 2008. He then took a dormant company he had, SRT (Building and Electrical) Ltd, and changed its name to Fire Systems (North West).
ADS, an electrical engineering firm, was contracted to the tune of hundreds of thousands of pounds by Mandale, large-scale property developers who built residential and student accommodation. Tipping was sub-contracted to ADS.
Protec had major contracts for prisons, hospitals and airports and SRT and Fire Systems began to install legitimate systems for them. But Tipping got work on occasion fraudulently by his dishonest agreement with Petrie and Robertson. Tipping went on to purport to install Protec systems and have them commissioned by the firm, but the equipment was stolen and fraudulently commissioned.
Mr Priestley said in the third part of the scam. Tipping fraudulently sent Protec invoices for £100,000 of work from Fire Systems rather than SRT (Electrical), even though SRT had done the work, to divert money away from the liquidators and creditors of SRT (Electrical) Ltd.
The prosecutor said Tipping, saying he was a Protec sub-contractor, was awarded the fire alarm and detection systems supply and installation work for projects ADS were doing for Mandale. Tipping invoiced ADS £254,909, or one job of putting in equipment at a 386 bedroom development in Middlesbrough.
Tipping had an agreement with Petrie and Scholes to fraudulently commission the systems and certificates were signed by people who did not exist. They used Protec laptops and security dongles. All the systems later had to be recommissioned in the interests of safety and to make them legally compliant. Several faults and defects had been found.
The court heard the total trade price loss to Protec in devices and commissioning costs was about £156,642, excluding VAT.
Mr Priestley continued: “The stolen parts were installed as part of a fire detection system which was fraudulently passed off as being a legitimate, new, fully functioning Protec system. This was often done in a way that showed a callous disregard for the safety of the occupants of the building.”
After the hearing, Mr Barrie Russell, managing director of Protec, which employs 700 people in the UK, 100 in Holland and has been in existence 43 years, said the sentences on the defendants, who he described as “bad eggs”, was satisfactory.
He continued: “All our other employees are fantastic people, who have made the company successful. They are loyal, honest employees and I wouldn’t want their reputation to be tarnished by those five.” Mr Russell added: “Whatever has happened, none of our clients have been affected.”
Detective Inspector Dave Groombridge, from Nelson CID, said: “The losses to the company were minimised by the decisive action taken internally and due to their collaboration with police, none of Protec’s clients have been affected.
“All the defendants were involved at various levels to steal, install or commission stolen Protec equipment. Both Petrie and Robertson held positions of trust at the company, which they fully abused in order to steal large amounts of stock.
“The most concerning aspect of this case is that there was sub-standard installation of second hand equipment in high fire risk student accommodation, resulting in remedial works having to be undertaken by the building owners to ensure their safety.
“I hope this sentence demonstrates that the police will do everything within their power to detect fraud and support local businesses.”