A company boss from Worcestershire has been jailed for three years for his part in a scam which saw tens of millions of eggs falsely passed off as free range.
The near two-year fraud also led to eggs wrongly labelled as organic being sold to consumers in supermarkets and other stores across the country, Worcester Crown Court heard.
Jailing Keith Owen, who admitted three charges under the Theft Act in relation to the fraud, Judge Toby Hooper QC said the 44-year-old defendant had abused the “well-intentioned” trust of the public.
Owen, of Warbage Lane, Dodford, near Bromsgrove, pleaded guilty earlier this month to three charges of providing false information for accounting purposes to firms in the egg supply sector between June 2004 and May 2006.
The judge also ordered Owen to pay £250,000 in costs and to settle a £3 million confiscation order within 12 months, or face a further six-and-a-half years in prison.
Judge Hooper heard that Owen was a middleman who sold battery and “industrial” eggs imported from France and Ireland to other suppliers, who were variously told that they were British, free range, organic or even that they met the RSPCA’s Freedom Food welfare standards.
Passing sentence, the judge said Owen’s business, Heart of England Eggs Unlimited, made very substantial profits at the expense of “real-life victims” who mistakenly believed they were buying free-range eggs.
Describing Owen as the guiding mind of the firm, the judge told the managing director: “Imprisonment there must be, because the offences are plainly so serious that only a sentence of imprisonment will suffice.
“This was all a carefully planned and executed fraud by false accounting.
“By greed, you have corrupted and destroyed the once-legitimate business which you have known all your life.”
Amanda Pinto QC, prosecuting on behalf of the Department for Environment, Food and Rural Affairs (Defra), told the court Owen had tried to cover his tracks by creating false documents and invoices for customers, accountants and the authorities.
But he was prosecuted after suspicions were raised about the “identity” of millions of eggs, including concerns reported by lorry drivers picking up consignments from Heart of England’s premises.
Opening the case against Owen, Ms Pinto told the court: “This case is about the dishonest supply of battery eggs, which were said to be free range or organic, by a middleman.
“Heart of England Eggs, run by Keith Owen, was an egg-packing business which supplied eggs to major packing companies, which in turn supplied them to supermarkets as well as smaller retailers.
“Over a number of years, the defendant dishonestly and systematically passed off millions of battery farm eggs as free range.
“The victims of Keith Owen’s false accounting were not only the direct customers of Heart of England Eggs, but also the public, as well as legitimate egg producers.
“The ultimate customer, a member of the public buying these eggs, would have received inferior quality eggs - sometimes even eggs not fit for sale to the public - or eggs produced by hens kept without the stringent welfare requirements of schemes from which they were said to benefit.”
Ms Pinto added that a Defra investigation had established that Owen’s firm, based in Bromsgrove, had also “padded out” supplies of genuine free range eggs with far cheaper industrial or caged ones.
“The stark reality is that they (Heart of England Eggs) bought many more cheap cage eggs than free range and organic, and sold far more free range and organic than they had supplies to fulfil.”
Investigations conducted by the Egg Marketing Inspectorate, which began in 2004, found that Owen was supplying eggs with false paperwork.
Tests on eggs were then conducted under ultra-violet light, allowing investigators to see wire-marks which are only left on the shells of caged hens’ eggs.
“Regularly eggs supplied by Heart of England were seen to bear the marks of cage-rearing, which would have been impossible had ... free range producers actually provided the eggs,” Ms Pinto added.
Defra investigators estimate that Owen, who was buying caged eggs at around 35p per dozen and selling them on for up to 90p per dozen, may have wrongly passed off around 100 million eggs.
John Kelsey-Fry QC, defending Owen, stressed that the offences had not resulted in any adverse impact on public health.
Speaking after the hearing, the head of Defra’s dairy, eggs and poultry team, Richard Jones, described the case as the biggest food industry fraud that the department had ever prosecuted.
Asked to comment on the custodial sentence handed out to Owen, Mr Jones said: “I think it sends a strong message to anyone in the industry.
“They are now well aware of what the courts will do if we take action.”
The British Egg Industry Council said it fully supported investigators after it was made aware of the allegations regarding Heart of England Eggs in November 2006.
A spokeswoman for the council said it immediately instigated an unannounced audit of Heart of England’s packing station, where serious discrepancies were found.
Three other defendants, including 49-year-old Pearse Piggott, of Ballylennon, Gort, Co Galway, were originally charged with conspiracy to defraud following inquiries into Heart of England Eggs.
But the charges faced by the other defendants were ordered to lie on the file after prosecutors decided not to proceed against them.
The British Retail Consortium (BRC) described the fraud as an exceptional situation which had coincided with a shortage in free range eggs supplies.
BRC spokesman Krishan Rama said: “Customers should be reassured this fraud was spotted.
“Suppliers of eggs are routinely checked by independent assessors to ensure legal standards are being met.
“Most of the eggs sold in the UK come from a few main suppliers, which makes it straightforward to monitor the industry.”