Police raid homes over £1.5million internet fraud

An astonishing haul of 20,000 counterfeit DVDs and videos were seized in dramatic raids on five local addresses early on Friday.

The counterfeit DVDs were of new films such as Spiderman or movies yet to be released and most of them had been imported from Malaysia. They were being sold on the net for around 10.

Five members of the same family were arrested in raids by police on five homes - four in Hastings and one in Bexhill.

The three men and two women are now on bail until September and could face charges of conspiracy to defraud and trademark offences - which carry a maximum 10 year prison sentence.

Two of the men are brothers.

Spencer Mott, director of operations for the Federation Against Copyright theft (FACT), said: "It is the biggest internet fraud case we have ever dealt with and it is the biggest internet film scam we have ever dealt with in this country."

An internet investigation launched over a year ago and conducted by FACT's senior investigator Patrick Timoney led to Friday's raids. The operation took six months to plan and involved 15 Hastings police officers. Several police vans were needed to remove the boxes full of DVDs and tapes, laptops, hard drives, games and mobile phones which were seized. Cash and foreign currency were also taken away by officers.

Mr Mott said: "I estimate the property value of what we have seized along with the site's records to be worth about 1.5million. Most of the DVDs have been produced in South East Asia and been sent all over the world from these addresses."

He pointed out: "The film industry has lost 400million through piracy over the last year."

Mr Mott said family members and partners were involved in the local operation.

FACT, a licensed investigative body, is now technically examining the seized DVDs and goods and it is up to them to bring a prosecution.

Mr Mott told the Observer: "We knew it was a big operation just by the amount of trade they were doing on the internet but you never know whether you are going to hit the right addresses.

"There were orders going out all over the world - some were going to America."

Hastings Police Sergeant Neil Redman said FACT had been investigating the web sites over the last year where DVDs were for sale.

"We are talking about a lot of web sites - as soon as they are closed down they open another," he said.

Sgt Redman explained that the money for the counterfeit DVDs had to be sent somewhere and they had information about three addresses and then gained evidence of two others.

Two of the homes raided were close to the town centre, one was in the Mount Pleasant area and another an area close to Harley Shute Road, while the Bexhill address was near to Glyne Gap.

He thought the people were very surprised over the raids.

"The seized goods will be passed on to FACT who will technically examine them and it is up to them to bring a private prosecution because FACT is a licensed investigative body and it is their area of expertise."

FACT had been monitoring a number of websites advertising and selling via mail order counterfeit DVDs from South East Asia, mainly Malaysia and it was this investigation that revealed web sites operated by two brothers in Hastings.

FACT's investigation revealed the use of drop mail addresses and covert payment methods through a third party internet-based organisation.

They had received numerous complaints from the film industry about the illicit web-based operation and the products sent to consumers.

It rips off the US and UK film industry by millions of pounds and hits consumers and the governments as a result of lost VAT revenue and income tax.

Mr Timoney's investigation identified at least eight web sites attributed to two men in this area as well as original 'mother' sites. They are thought to have been set up as the mail order operation became a substantial commercial business. The business needed to 'fragment' to minimise the disruptive effect of any 'take down' procedure.