'Phantom' security boss failed to pay staff
15 November 2019
A SECURITY boss who ran seven companies under four different identities has been found guilty of defrauding security operatives who worked for him.
John Gaines, 72, of Leamington Spa, was found guilty of 22 charges of fraud at Warwick Crown Court on Monday 30 September.
Gaines employed Security Industry Authority (SIA) licensed security guards at a number of locations, including construction sites belonging to Heathrow Airport and Tesco. In many cases he either failed to pay them in full, or didn’t pay them at all.
Gaines was also found guilty of claiming to be “SIA approved”, despite not being a member of the SIA Approved Contractor Scheme. Sentencing has been deferred to 14 November pending the production of a pre-sentencing report. Gaines has been remanded into custody in the meantime.
Nathan Salmon, of the SIA’s criminal investigation team, said, “I am grateful to the jury for returning guilty verdicts on all 22 counts in this case. In part, private security regulation was introduced to address “cowboy” operators, and I can think of no better word to describe Gaines’ actions.
“Through various aliases and phantom businesses, Gaines set out to employ security operatives, withholding their pay whilst profiting from his contracts. He employed new staff to replace those who left, continuing his fraudulent behaviour many times over. He sought to conceal his identity, hid behind wild excuses, and was threatening to some employees who were merely seeking payment for the work they did for him.
“The SIA recognised the harm Gaines was causing to regulated individuals within our industry, and I am grateful to the 21 employee victims who bravely came forward to secure this conviction.”
The case was brought to the SIA’s attention following a series of complaints to police and Action Fraud. These complaints related to companies that were under suspicion of failing to pay security operatives. Analysis had shown that several of the companies in question shared e-mail addresses and phone numbers. This information was passed to the SIA by the Government Agency Intelligence Network (GAIN).
The SIA conducted a lengthy and complex UK-wide investigation into a number of contracts running from 2012 to early 2016. They had all been secured by one individual, John Wear Gaines, using various pseudonyms and different company names.
The SIA, in conjunction with Warwickshire Police, arrested Gaines in October 2017 and seized material linking him not only to the businesses in question, but to several alternative identities. This material included hundreds of business cards and flyers at Gaines’ house in the names of Geoff Caines, Robert Fox, and David Ward. The “David Ward” cards contained the claim to be “SIA approved”.
Most of the businesses Gaines ran were sole trading entities, run virtually from his home. Only one, Crown/Accord Nationwide Security, was registered at Companies House. The company director was listed as “Jeff Cains”, another alias of John Gaines.
Gaines told the court that the workers whom he failed to pay were either “asleep on the job” or had failed to provide proper documentation. However, the court heard from a variety of witnesses who claimed that he refused to supply written contacts, ignored requests for payment, and left threatening phone messages for those who he defrauded.