Counterfeit toy trader banned after £1.5m scam busted by Trading Standards

The director of a firm that imported, sold and stored more than £1m of counterfeit toys - some of which were sold in high street shops in Blackpool - has been given a two year jail term, suspended for two years.

Thursday, 27th April 2017, 4:15 pm
Updated Tuesday, 9th May 2017, 7:07 pm
Some of the counterfeit toys that were seized

Company Amazing Savings Ltd (ASL) and its director Jonathan "Jonny" Kahn, 64, of Parkway, Golders Green, London, had denied peddling tens of thousands of fake Teenage Mutant Hero Turtles and other branded toys to major high street shops.

The father-of-12 and his firm were found guilty of a string of 34 trademark offences by jurors at Preston Crown Court, and he was disqualified from being a company director for four years.

He must also do 300 hours of unpaid work - the maximum in law.

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Counterfeit Spiderman toys were seized by Trading Standards

It is thought by authorities to be one of the biggest Trading Standards cases in the United Kingdom.

Members of Kahn's family, who sat in the full public gallery clutching copies of the Tanakh holy book, sobbed as Judge Stuart Baker said: "The offences involved importing and either selling or storing some 265,000 toys at a total sale price to your customers of over £1.5m.

"Some of those have been returned to you and I'm told you've had to reimburse your customers, but these figures are a reflection of the scale of the business and you and your company were involved in.

"You knew throughout or at some stage that you were buying counterfeit goods.

Teenage Mutant Ninja Turtles goods were among the stock recovered

"You were informed by Trading Standards officers that some Spiderman toys supplied were counterfeit.

"Nevertheless you continued to buy from him.

"I am unable to accept you honestly believed the toys which you supplied or continued to hold in storage were in fact genuine toys."

Judge Baker said such cases not only undermined public confidence in the goods they buy, but also have the effect of damaging the trading revenue and reputation of the genuine owners of the trademarks.

Counterfeit Spiderman toys were seized by Trading Standards

He said he could suspend his sentence due to his good character, long period of honest and reputable trading, and the fact it was probable he will face financial ruin as a result of the Proceeds of Crime Act inquiry which will take place on October 19.

He added he could not impose sentence on the firm itself until those proceedings.

Prosecuting, David Traynor described how the importers provided toys to popular high street chains in the resort, including B and M Bargains, TJ Morris Ltd, which runs Home Bargains, and Lewis Home Retail Ltd, which runs TJ Hughes, ripping off brands such as Marvel, Hasbro and Viacom.

The alleged offences came to light during a probe by Blackpool Council's trading standards department after a tip off that counterfeit 15cm Teenage Mutant Ninja Turtles (TMNT) were on the shelves of B&M Bargains.

Teenage Mutant Ninja Turtles goods were among the stock recovered

The court previously heard when sales had been agreed and the companies had requested a sample, genuine figures had been sent - but it is alleged once the transactions were agreed, ASL would source cheaper, black market goods from the Far East.

Mr Traynor said: "The defendants must have known counterfeit toys were being supplied, and the Crown does not accept it was simply a failure to exercise due diligence.

"It is a knowing trading in counterfeit goods.

"Jonathan Kahn is a businessman with over 40 years experience and there are previous warnings for him and opportunities to gain experience, with previous encounters of infringing goods."

He added he had been made aware of the probe by Trading Standards into his dealing with a toy supplier but had continued dealing with the firm after that date.

It was also clear that at the times orders were found to have been placed by ASL, Kahn could not have physically had a sample in his hands.

Mr Traynor also highlighted the 'complete lack of any checks on delivered stock'.

Jurors were previously told of incriminating e-mails between Kahn and his main supplier from China - who called himself Eddie Wong - in which Wong says: "We ask them to steal part of the goods for us around end of April."

Another said: "Factory advises the item is brand new and going to start production shortly. So we need to confirm the factory immediately and ask them to produce extra plastic parts for us at the same time."

Trading Standards also found ASL had employed a packaging firm to make labels giving the details of the importer as ‘Jabon Y Olor’ of Almeria, Spain.

The charges amount to 252,841 toys actually sold to firms in Blackpool and across the UK, and 19,783 other toys that were in their possession that they intended to sell.

Defending, Daniel Thomas said: "This was a new endeavour that went very badly wrong - I can't state it more highly than that. He gave extensive evidence about his trading before this time.

"He accepts he should have done more. He accepts the jury's verdict. The financial cost has been extremely large. He paid a surcharge on all the goods returned by B and M Bargains.

Judge Stuart Baker ordered a Proceeds of Crime Act hearing to take place on October 19.

The offences

The court heard that Khan:

- sold 8,004 counterfeit turtle figures in 2014- sold 14,096 counterfeit turtle figures in 2015- sold 42,996 fake Spiderman Triple Attack figures between 2014 and 2915- sold 1,000 fake Spiderman Triple Attack figures in 2014- sold 1,063 fake Spiderman Triple Attack figures in 2015- sold 38,460 fake Teenage Mutant Ninja Turtle vehicle sets- sold 8,529 fake Teenage Mutant Ninja Turtle vehicle sets- sold 12,783 fake Pie Face games- sold 29,358 fake Spidey Shot Web Fluid Figures- sold 27,072 counterfeit Spiderman webcopter sets- sold 10,040 counterfeit Spiderman webcopter sets- sold 37,440 fake Superhero Mashup figures- sold 20,000 counterfeit Spiderman figures- sold 2,000 bogus Spiderman figures.- possessed 4,000 fake Spiderman Triple Attack figures with a view to selling them- possessed fake 9,120 Leonardo Teenage Mutant Ninja Turtle figures with a view to selling them- possessed fake 6,633 Mutant Ninja Turtles vehicle sets with a view to selling them