3 guilty in fraudulent aquaculture venture

Three men have pleaded guilty in Cardiff Crown Court in Wales in connection with a scheme to defraud the EU and Welsh governments while promising “to make Wales a world leader in the aquaculture industry.”

jennyt | Bigstock.com
jennyt | Bigstock.com

Three men have pleaded guilty in Cardiff Crown Court in Wales in connection with a scheme to defraud the EU and Welsh governments while promising “to make Wales a world leader in the aquaculture industry.”

Anthony Smith, 72, claimed GBP4.7 million (US$6.2 million) in grants to develop an alternative fish feed. The venture was supposed to create 120 new jobs, but it only created seven and Smith used the remaining money for other purposes.

“Not only did Anthony Smith wildly overstate how much money had been spent, but he made up stories about projects which never existed,” said Janet Potter from the Crown Prosecution Service (CPS) specialist fraud division. “He did this all under the guise of being environmentally friendly and boosting the local economy. He promised to make Wales a world leader in the aquaculture industry, but instead he abused the system and robbed the local community of investment.”

The grants issued to Dragon Research Ltd., Dragon Feeds Ltd. and Dragon Baits Ltd. were meant to develop a plant that would process ragworm for fish food and bait and ponds in which to rear them. Instead, Smith used the money to purchase machinery that was not a part of his original application.

According to a press release from the court, at the heart of the prosecution’s case was proving that Smith knowingly and willfully misused government funds. The CPS used software to investigate financial records belonging to the Welsh government and reviewed 7 million items of digital material. In addition, a forensic accountant was hired to review financial accounts which enabled the CPS to prove that Smith had deliberately structured the business in order to hide the flow of illegitimate funds.

Smith pleaded guilty to three counts of fraudulent trading. In separate hearings, Colin Mair, 68, pleaded guilty to one count of fraudulent trading, and Keith Peters, 72, pleaded guilty to two counts of false accounting. Sentencing for all three is scheduled for May 10.

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