Victims of rogue security boss win payment for ill-gotten gains
John Gaines, 72, of Leamington Spa, who defrauded his employees while working under four false identities, was ordered by Warwick Crown Court on January 20 to pay £91,934.21 under the Proceeds of Crime Act (POCA). The Security Industry Authority (SIA), which brought the original proceedings, demanded that £58,000 from the confiscation order be paid as compensation to former employees whom Gaines had defrauded.
Gaines was jailed on November 14, 2019 following a lengthy jury trial at Warwick Crown Court. He was sentenced to 4 years and 8 months in prison after being found guilty of 22 counts of fraud. Gaines had employed people under security contracts and then terminated their employment without paying the wages he owed them.
Many of Gaines’ victims appeared as witnesses during his trial. Gaines recruited easy-to-exploit staff; people who have recently arrived from other countries, those who have health problems or those who live in shelters for the homeless. If the staff worried about their treatment, Gaines would threaten to fire them and subject them to verbal abuse.
In handing down his sentence, His Worship Justice Potter lamented Gaines’ “systematic exploitation of vulnerable individuals for profit” and referred to the 21 security guards “left in trouble” by his dishonesty.
Mark Chapman of the SIA’s Criminal Investigative Team said:
The decision in this case puts an end to a long and complex investigation, which took almost three years to be brought before the courts. Mr Gaines has employed dozens of security guards to work for his various companies under a number of contracts. He then deliberately failed to pay the wages he owed. When challenged, he evaded, threatened and intimidated his “employees” by claiming that their work was substandard or that they had incorrect documents. This was untrue and 21 of his former employees testified at his trial. Following Mr Gaines’ conviction for multiple fraud, the SIA used its powers under the Proceeds of Crime Act to identify the money and property he was holding and asked the court to compensate his victims from the money he was ordered to repay.
At the POCA hearing, the court found the total criminal profit from Gaines’ illegal activity to be £445,336.84. He learned Gaines currently had £91,934.21 at his disposal following the court’s finding that he had a beneficial interest in a house in Enniskillen. Gaines has three months to pay the sum or face an additional 12 months in prison. At the end of that period, Gaines still owed the full court-ordered amount. Gaines remains liable for the unpaid amount of penal benefits, which the court will continue to pursue.
The case came to the attention of the SIA in 2016 following a series of complaints to the police and Action Fraud. These complaints concerned companies suspected of not having paid the security guards. The analysis had shown that several of the companies in question shared email addresses and telephone numbers. This information was transmitted to the SIA by the Government Agency Intelligence Network (GAIN).
The SIA, working with Warwickshire Police, arrested Gaines in October 2017 and seized documents linking him not only to the companies in question, but to several alternate identities.
Notes to editors:
- the Proceeds of Crime Act 2002 (POCA) establishes the legislative scheme for the recovery of criminal assets, with criminal forfeiture being the most commonly used power (forfeiture occurs after a conviction has occurred)
- if a person has a POCA order against them, they must pay it whether or not they are serving jail time
- by law, security guards working under contract must hold and display a valid SIA license
- learn more about SIA enforcement and penalties
Further information :
- The Security Industry Authority is the body responsible for regulating the private security industry in the UK, reporting to the Home Secretary under the Private Security Industry Act 2001. The main functions of the SIA are the issuance of compulsory licenses to persons undertaking designated activities and the management of the voluntary licensed contractor program.
- For more information on the Security Industry Authority, visit www.gov.uk/sia. The SIA is also on Facebook (Security Industry Authority), LinkedIn and Twitter (SIAuk).