A CROSS-BORDER investigation is taking place into huge quantities of low-sulphur green diesel being passed off as genuine diesel to unsuspecting motorists.
An increasing number of forecourts in the Republic and in the North are selling the laundered product, according to sources.
It is estimated that up to 90 per cent of the 50 million litres imported into the Republic last year was being bought for laundering.
The joint investigation is being carried out by the Revenue Commissioners and the UK Customs and Excise.
The low-sulphur diesel is legitimately made for use in tractors and other off-road vehicles but its low-sulphur content means it can be harder to detect by Customs.
Smugglers are making massive profits from passing it off as proper auto-diesel. According to one former smuggler, the product is 10-15 cents a litre more expensive to buy than regular green diesel “and the only way to make a profit from it is to launder it”.
This is because it can then be passed off as regular white diesel which commands an even higher price
Informed sources estimate that up to 75 per cent of the laundered fuel is being exported to the UK but the amounts being used in the Republic are continuing to grow.
The acids used to launder or wash away the green marker in it – which identifies it for off-road use – always leave a residue.
“In recent weeks we have had people ringing us to complain about their engines being wrecked and costing them big money to fix,” a Customs source said.
Another said: “We have names of people we suspect are storing it, laundering it and then selling it as legitimate auto-diesel.
“This is not just a Border problem and we suspect major names are involved in distributing this low-sulphur fuel.
“We estimate that in the region of 90 per cent of it is being laundered by criminals.”
He said at least six smugglers in Dublin, Louth, Monaghan and Cavan had been identified and that there were forecourts in the midlands and northwest also suspected of selling it as auto-diesel.
At least one of these smugglers has convictions both sides of the Border for fuel laundering but he is hiding behind shelf companies and using someone else’s hydro-carbon licences which is needed to operate a garage.
The former smuggler said yesterday that 50 loads of the fuel were “being cleared through Customs every week” in one Border county.
Customs can approve its importation for legitimate purposes but its final destination is the problem.
“This has been growing over the past year and I can’t see it stopping,” the former smuggler added.
A legitimate fuel importer based near the Border said there were three garages in his town selling the laundered fuel.
A spokesman for UK Customs based in Belfast said it operated a multi-agency approach by working with the Revenue Commissioners and Cab in the Republic and the PSNI and the Serious Organised Crime Agency (Soca) in the North.
“We have a number of ongoing investigations involving fuel fraud and it would not be appropriate to comment on them at this time.”