FATHER and son conmen have been jailed after hatching a digital jukebox scam that took more than £500,000 in royalties from the music industry.
Malcolm Wylie and his son Peter set up a string of companies selling music systems to pubs and clubs across the North East from their Gateshead-based company whose turnover was more than £1.3m.
But the tunes were downloaded without permission, costing artists and their record companies more than £500,000 in royalties, and putting the pubs and clubs at risk of prosecution.
Now, following a landmark legal case by the British Recorded Music Industry and the Phonographic Performance Limited, the pair have been handed jail terms totaling more than four years after industry bosses seized illegal jukebox systems used in the scam.
Sentencing at Newcastle Crown Court yesterday, Judge Guy Whitburn said the prison time should act as a deterrent to others.
During a crude operation that stretched the length of the country, the Access All Areas company raked in hundreds of thousands of pounds by selling their music systems to clubs and pubs at prices ranging from £5,000 to £70,000.
But over the last two decades, Wylie Snr and Wylie Jr operated as many as six phoenix companies, helping them elude capture by declaring themselves bankrupt and setting up new business with near-identical names.
On their official website they boasted to be the “only full licensed mobile product on the market in the UK” and when venue owners refused to pay upgrade fees they were told they would face prosecution. A third man, William Ross, became embroiled in the scam when he ploughed £60,000 of his own cash into the business. But he was unaware that the business was operating illegally and he was not involved in the day-to-day running of the operation because of serious ill-health.
Their scam was uncovered when music industry bosses raided their property in May 2008 and uncovered a hoard of illegal systems being prepared for the market.
Officials claim they struck at more than 200 businesses across the country, with at least 100 left out of pocket in Newcastle, Gateshead, Northumberland and County Durham.
Prosecuting, David Groome said: “In broad terms, none of the music and videos used with the systems was properly licensed.
“The defendants’ business obtained the music by illegally downloading it from the internet and by copying it from CDs.”
At an earlier court hearing Malcolm Wylie, 59, of Salcombe Gardens, Low Fell, Gateshead, admitted one count of distributing infringing copyright work between May 2003 and January 2009.
He was sentenced to three years in prison and banned from taking the position of director for 10 years.
Ross, 66, of Australia Tower, Sunderland, also pleaded guilty to the same offence and was given a 36-week prison sentence, suspended for one year as part of a community order.
Peter Wylie, 27, of Malton Green Gardens, Harlow Green, Gateshead, was found guilty by a Crown Court jury of two counts of the same offence.
He was given a nine-month prison sentence and a 15-month sentence, to run concurrently.
Representing Wylie Jr and Ross, Nelson Cairns said: “Wylie Junior is a young man who should not have been put in that position by his controlling father. Ross is in ill-health, has worked-up debts of £40,000 and is now forced to live a modest lifestyle.”
Representing Wylie Snr, Bart Casella said: “He accepts the responsibility.
“These are easy words, but he is adamant that his son is spared.”
David Wood, BPI’s director of anti-piracy, said: “The significant sentences demonstrate that what may seem a victimless crime clearly is not. As stated in the course of proceedings today, intellectual property is property and stealing it is a crime.”