EU agency helps dismantle fraudulent rum network

EU agency helps dismantle fraudulent rum network

by Sue Jones
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Investigators have cracked a network that sent counterfeit rum from Central America to Europe.

Authorities said counterfeiting poses serious risks to health and safety but no-one is believed to have been ill in Europe.

In May, the Ministry of Public Health in the Dominican Republic reported that 420 people had suffered intoxication from beverages adulterated by methanol in the country and 145 had died this year.

The most recent investigation found the main destination of the fake rum was Spain but the fraud, which involved the liquor, bottles and labels, covered several countries and continents. Once bottled and labelled, the rum was shipped to the EU from Honduras and Guatemala.

The point of entry was mainly via the Netherlands, with goods then transported to Spain. The fake labels used several different brand names.

Thousands of bottles confiscated
The European Anti-Fraud Office (OLAF) was a coordination point between national authorities in Spain, the Netherlands, Honduras and Guatemala.

Information provided by the agency resulted in the seizure of roughly 340,000 bottles with an estimated value of €4.5 million ($5.3 million). Hundreds of suspicious containers were detected.

Following a tip off by OLAF, Honduran authorities seized two containers of fake rum and halted operations at the illegal production site. The liquor was produced in the Dominican Republic, bottled in Honduras, and counterfeit labels from China were put on drinks.

Multi-year and country operation
Ville Itälä, Director-General of OLAF, congratulated national authorities on the results that came despite the COVID-19 pandemic, which turned on-the-spot checks and meetings into online exchanges.

“This series of interventions was a major blow to a network that smuggled fake rum into Europe, and hopefully we have put a stop to it. I am glad that OLAF, with its international experience, could act as a pivot in a case with such cross-border dimensions. Together, we have made a contribution to protecting the health of EU citizens and to supporting the interests of legitimate EU companies.”

Earlier this year, the Spanish Guardia Civil reported it had intercepted more than 225,000 bottles of counterfeit rum as part of Operation Hitsmo.

An investigation led to 24 people either being arrested or investigated. The operation began in February 2019 and involved more than 50 Spanish, Portuguese and Dutch companies.

The first seizure of fake spirits as part of the probe took place in the Netherlands in late 2019 and involved 147,000 bottles of rum destined for Spain. OLAF and Dutch authorities inspected a warehouse in December 2019 and found that 96 percent of the bottles contained counterfeit rum, worth an estimated €2 million ($2.36 million).

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