May 15, 2012 / 2:01 PM / in 6 years

Potato suppliers scammed Sainsbury's for millions

LONDON, May 15 (Reuters) - A multi-million pound fraud involving the supply of potatoes to supermarket giant Sainsbury’s was “corruption on a massive scale”, prosecutors said on Tuesday as a jury convicted one of the scam’s key players.

Andrew Behagg, 60, the finance director of food supplier Greenvale, has been told he faces a significant jail term after being found guilty of paying bribes to a Sainsbury’s buyer.

Thousands of pounds of cash in brown envelopes was handed to the buyer, John Maylam, who splashed out on lavish meals and stays at top London hotels, Croydon Crown Court heard during the trial.

Greenvale supplied around 45 percent of Sainsbury’s potatoes in 2008 at the time of the scam, and prosecutors said it overcharged the supermarket by millions of pounds.

The jury of 10 men and two women took five hours and 45 minutes to convict Behagg, from Cambridgeshire, of one count of corruption, the Press Association reported.

Judge Nicholas Ainley said: “For any case of this magnitude a sentence of imprisonment is almost inevitably passed, and a significant one at that.”

Behagg is expected to be sentenced on June 22 at the same court alongside Maylam and Greenvale’s account manager David Baxter, who have both admitted corruption.

“This was corruption on a massive scale,” said Sue Patten of the Crown Prosecution Service Central Fraud Group, in a statement after the verdict.

The prosecution’s case was that as a result of the corruption, Greenvale was able to keep lucrative business for the supply of potatoes to Sainsbury‘s, valued at 40 million pounds per year, at the same time as overcharging them.

“Maylam was showered with excessive gifts and hospitality including stays at Claridges, costing a total of 200,000 pounds and a luxury 12-day excursion to the Monaco Grand Prix in 2007, at a cost to Greenvale of around 350,000 pounds,” Patten said.

”Maylam also received lump sum payments, via an account in Luxembourg, to the tune of 1.5 million pounds, supposedly for the storage of potatoes in Spain and other bogus activities.

“In return for these criminal payments, Greenvale employees Baxter and Behagg were able to collude with Maylam in overcharging Sainsbury to the tune of 8.7 million pounds.”

The supermarket expressed its satisfaction with the verdict.

It said in a statement: “This was an unacceptable and calculated crime against Sainsbury’s of a magnitude never experienced in our history.”

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