St Annes man convicted of international fraud after Covid-19 PPE firm boss splashed £100,000s on luxury cars

A Fylde coast businessman has been convicted of an international fraud during the Covid-19 pandemic.

Craig Morris, of All Saints Road, St Annes worked for a company in 2020 that was set up to buy and sell nitrile gloves to be used as PPE (Personal Protective Equipment) during the pandemic.

The company, owned and controlled by Jogesh Bhandari, 59 from Loughborough, fraudulently claimed to be able to provide PPE during the pandemic, with Bhandari instead spending hundreds of thousands of pounds on house renovations and luxury cars.

Following a National Crime Agency investigation, Morris, 43, was found guilty alongside Bhandari and Meenakashi (Meena) Bhandari, 58.

Morris made representations on behalf of the company in numerous fraudulent deals in 2020 and 2021.

Bhandari worked with Frank Labruzzo, a US Assistant Attorney General at the Louisiana State Department of Justice, who provided a fraudulent escrow service. An escrow account is a bank account which acts as a holding point for funds that are release when both sides of an agreement have been reached.

Bhandari's first fraudulent activity began in November 2020 where he agreed a deal to provide 12 million boxes of gloves. The company paid the escrow account and, rather than funds remaining in the account until the deal was complete, the money was immediately moved and paid to Labruzzo, Bhandari and other companies.

In a second deal a month later, Bhandari received a further $2.7m into the account, and almost $500,000 was withdrawn to pay off his and his wife's debts. Bhandari supplied a number of forged documents to potential suppliers, including bank statements showing up to $125m and letters of attestation to try and persuade businesses to trade with him.

In early 2021, he was paid more than $3.18m for an order of nitrile gloves to be delivered to US hospitals that were never delivered. His final fraud took place in late 2021 where Bhandari persuaded a supplier he was a big player in the PPE industry and had access to hundreds of millions of dollars.

The company agreed to a deal worth $1.8bn and Labruzzo provided a fraudulent letter to state Bhandari had deposited $35m as a security against the first delivery. The company then paid $1.35m for the first two planned shipments.

In the final deal, Bhandari received the $1.35m straight into Bhandari's business account, controlled by his wife Meenakashi (Meena) Bhandari, 58, from where he sent £200,000 to Morris and bought himself a brand-new Porsche.

‘Let’s clean up!’

More than 47,000 WhatsApp messages and emails were swapped between the defendants during the course of their criminality.

In messages Morris says 'All over the news is all about ppe shortage. Let's clean up!! Milk it... fill ya boots'. Bhandari replies: '[thumbs up] it's about a good teamwork and EVERYONE making money'. On another occasion, Bhandari sends an image of a Rolls Royce and tells Morris: 'But if I want one of these [Rolls Royce] then we need to keep going'.

A total of £126,000 was spent on Bhandari's new Porsche. Other cash was spent on a kitchen refurbishment and extensive home improvements on Bhandari's home which he shared with Meena.

As well as paying off debts, bank records showed the Bhandaris spent hundreds of thousands of pounds on Rolexes and other luxury watches, jewellery, cars including an Audi A5, a Land Rover Discovery and a VW Golf, and worldwide luxury travel and holiday packages. None of the money was used for its intended purpose.

Payments were also made to repay a debt owed by Meena. She was also charged with money laundering after the NCA investigation showed she was aware the funds used were from Bhandari's fraudulent activity.

Morris was due to receive regular £5,000 payments from Bhandari but the two men fell out at the end of 2021 and no further cash was received.

All three defendants were arrested in February 2023 and charged with several counts of fraud by false representation and money laundering. They appeared at Leicester Crown Court for a five-week trial and were convicted today (15 July). Labruzzo, alongside one other, has already been convicted in the US.

The Bhandaris and Morris will be sentenced on August 21.

‘Capitalised on vulnerabilities’

Paul Boniface, operations manager at the National Crime Agency, said: "The Covid-19 pandemic was a time of uncertainty for the world, and the increased need for PPE equipment was sudden. This gave fraudsters like the Bhandaris and Morris an opportunity to target businesses and line their own pockets.

"All of this activity occurred at the height of the pandemic where the demand for PPE went through the roof. Bhandari and his co-conspirators capitalised on these vulnerabilities by exploiting people and businesses for their own financial gain, paying for lavish lifestyles of luxury cars and significant home improvements.

"Fraud like this diverts essential equipment away from genuine organisations and the effects are far reaching, beyond immediate losses for the legitimate businesses involved.

"The NCA will continue to target fraudsters like these who cause significant harm to the UK economy."

The UK’s £10bn waste

In the UK, the scramble to buy PPE during the pandemic saw the UK waste almost £10 billion of taxpayers’ money, the official inquiry into the handling of Covid-19 has found.

In the fifth report of her inquiry, Baroness Heather Hallett criticised the “vast” waste in pandemic procurement, amounting to £9.9 billion – two-thirds of the £14.9 billion the UK and devolved governments spent on PPE.

And she criticised the controversial “VIP lane”, which prioritised offers of PPE from those with political connections, as a “misguided” and “unfair” process that undermined public confidence in procurement. But she said there was “no evidence of cronyism or corruption” by ministers or officials when awarding contracts.

Lady Hallett said: “The waste of taxpayers’ money was vast. The public must be able to trust that their money is being spent with propriety, fairness and transparency. Public confidence – so important in an emergency – was undermined by failures in procurement.”