The great Sainsbury's potato fraud: jail for vegetable buyer who took Â£5m in bribes

Ray · Jun 23, 2012

The great Sainsbury's potato fraud: jail for vegetable buyer who took Â£5m in bribes

hree senior businessmen who cooked up an elaborate scheme to siphon almost Â£9 million from Sainsburyâ€™s in a corrupt potato deal, were jailed today.

John Maylam, 44, a senior buyer for the supermarket chain, accepted almost Â£5 million in bribes from a supplier, which he â€œfrivolouslyâ€ spent on lavish holidays to Monaco and the South of France, a top of the range Aston Martin and in luxury hotels such as Claridge's.
He colluded with John Baxter, a director at Greenvale who massively overcharged Sainsbury (LSE: SBRY.L - news) 's for its crop.
Maylam admitted corruption and acquiring criminal property and was jailed for four years. Baxter, 50, admitted the same charges and was jailed for 30 months.

With the proceeds, the two men lived â€œlike millionairesâ€, running up a Â£350,000 bill at Claridge's, where they received brown envelopes stuffed with up to Â£2,000 in cash and hiring a Sunseeker motor yacht during a trip to Jersey.
For Maylamâ€™s 40th birthday, he was treated to a five star Â£350,000 holiday to Monaco for the grand prix, as well as stays in luxury hotels in Cannes and St Tropez.

Maylam was treated to a five star Â£350,000 holiday to Monaco for the grand prix

Three months later, he purchased a Â£94,000 Aston Martin V8 Vantage using funds that had been channelled from Sainsburyâ€™s though one of two foreign bank accounts used for money laundering.

The costs of such â€œtotally excessiveâ€ hospitality were written off in Greenvaleâ€™s accounts as â€œteam buildingâ€.

Sentencing the men at Croydon Crown Court Judge Nicholas Ainley said it was "very nearly as serious a case of corruption as I can imagine" that involved Sainsbury's "being bribed with its own money".

Police disclosed that Maylam sanctioned a Â£40 million annual deal that meant Sainsbury's was paying far more for certain varieties of the vegetable, particularly charlotte and baking potatoes, than it should.

By overcharging the supermarket, Greenvale was able to siphon the surplus money into a fund that was used to recompense Maylam for his business.

For two years, he reaped the rewards of the scheme, operated in collaboration with Greenvaleâ€™s finance director Andrew Behagg.

Two companies were set up to mask the flow of Â£1.5 million, neither of which had any legitimate business relationship with Greenvale, police said.

Detective Superintendent Tony Crampton, of the City of London Police said all three men had abused their positions and betrayed the trust of their employees.

â€œMaylam and Baxter both had good jobs with decent salaries. But they decided they wanted a place on millionaireâ€™s row so they cooked up an elaborate fraud that saw them divert seven figure sums from their employersâ€™ accounts,â€ he said.
â€œThey were greedy for a luxury lifestyle, frittering the money away on frivolous spending which was only made possible by Behaggâ€™s complicity.â€

Greenvale was desperate to keep its potato contract with Sainbury's which was worth around Â£40 million

DS Crampton said the men had thought their fraud was so complex it would not possibly be detected. But a successful four year investigation had â€œcost them their personal freedom and put an end to their careersâ€.

Although Sainsburyâ€™s estimated that it was over charged Â£8.7million between 2005 and 2007, just Â£4.9 million was accumulated in Greenvaleâ€™s corrupt fund.

The trioâ€™s complex financial arrangements meant that police were unable to establish what happened to the missing Â£3.8 million.
Maylam and Baxter both pleaded guilty to corruption and money laundering but Behagg denied his one charge of corruption, claiming that he was the victim of "extortion".

Judge Ainley said as he sentenced the men: "There will be many who find the details of frankly outrageous extravagance this case offers fascinating.

"But what must be remembered is that this is a case of bribery and corruption. But not just that.

"This is a case of corruption involving theft on a huge scale.

"Corruption because Greenvale wanted to keep the Sainsbury's contract - a contract for 45 per cent of Sainsbury's potato contract worth about Â£40 million - and they offered Maylam, the Sainsbury's buyer, all the lavish entertainment he wanted, over Â£1 million of it."

The judge added that the bribery "may not have been necessary at all" and said: "There may not have been a danger of losing the business."

The full details of the scam emerged during his trial and he was found guilty by a jury at Croydon Crown Court.

Maylam, from Maidstone, Kent, had worked for Sainsburyâ€™s for 20 years, starting at a low level and working his way up to become the highest point of contact for suppliers.

Both Baxter, 50, from Market Drayton, Shropshire, and Behagg, 60, from Cambridge (SES: E2:J91U.SI - news) , had been employed by Greenvale for many years.

All three were described as â€œfamily menâ€ of previously good character.

â€œThey have all had quite a significant falling from grace,â€ said DC Sharon Scott, who lead the investigation.

The great Sainsbury's potato fraud: jail for vegetable buyer who took Â£5m in bribes - Yahoo! Finance UK
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One keeps seeing the jeers of the 'developed world' as to how rotten the 'developing world' is so full of filth and corruption etc etc.

Well, this and the Murdoch scam should indicate that the 'rotteness' is well spread around in the world!

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The great Sainsbury's potato fraud: jail for vegetable buyer who took Â£5m in bribes

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The great Sainsbury's potato fraud: jail for vegetable buyer who took Â£5m in bribes

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