The Cartel The Inside Story of Britain's Biggest Drugs Gang

by Graham Johnson

  The latest attacks had come at a time when police were convinced they were winning the battle against the Cartel. But at the same time, the savagery and scale of the new gang wars had taken the police by surprise. Even the National Intelligence Model seemed to creak under the strain of having to tackle a new generation of gangsters who had more in common with insurgents in a war zone than drug dealers. Old-school officers began to call for action instead of flow charts. What happened next looked like an outright victory for the dark side.

  The police had made a breakthrough in Operation Thornapple, the investigation into the wave of firebomb detonations. Caswell’s DNA had been linked to the car bombs. In addition, the police were making hundreds of arrests in a bid to destroy his backer’s gang. But none of this seemed to bother the leaders. Richard Caswell’s response to the police was unprecedented. He and his bosses decided to take on the police in much the same way as they took on their underworld enemies. First, they wrongly blamed the police for taking sides, as though investigating the bombs was equivalent to lining themselves up with Shaun Smith. Second, they decided to attack the police in the same way as they had attacked Shaun Smith. Caswell blew up a car outside Tuebrook police station in a bid to make the police back down. He and his leaders felt so powerful that they decided to confront the authorities head on. The blast left a permanent bomb crater in the road outside, which would have looked more at home in Sarajevo or Baghdad than in a built-up area of Liverpool. Bomb-disposal experts said more than 20 shock rockets were used, enough to kill.

  As the gangland feud continued, the force urged all residents living near police stations to be on guard. In anticipation of a shoot-out, Caswell began stockpiling weapons in safehouses. For his own personal protection, he bought three firearms and ammunition.

  A few months later, a similar bomb was targeted at Walton police station. A Ford Fiesta was parked underneath a nearby railway bridge and detonated at 10 p.m. Had the police lost control? No private criminal organisation had ever tried to bomb the police. To some, it looked like the police were no longer an effective deterrent to the gangs.

  EPILOGUE

  2003

  BY 2003, THE Cartel was 30 years old. It had started out as a one-man band, the brainchild of a manipulative ex-petty criminal called Fred the Rat. Now it had grown into an international business with hubs in Amsterdam, Spain, Turkey, North Africa and South America. Thousands of people worked directly for the Cartel in multifarious roles. Thousands more were employed indirectly, or benefited from its economic activity in some other way: for instance, as part-time workers and sub-contractors. The Cartel’s structure was sophisticated: a rolling, rigid hierarchy that resembled a group of trading partners. In some ways, the Cartel looked like an emerging international business with a basic command structure. Economists call the model an ‘international area network’. Over the next decade, the shape of the organisation would change again, solidifying into a pattern normally found in modern global corporations, according to the police. In 2003, the Analyst began keeping a detailed database on the Cartel. Within five years, by around 2008, the Analyst would be able to map out the structure of a single division in great detail, identifying scores of managers and hundreds of employees meshed together in an extremely complex network of revenue flows and capital assets. Economists would describe the Cartel of having matured into something akin to a ‘global matrix structure’, a shape that made it possible to optimise the strength of participating units, distributing the pressure of business more evenly, avoiding duplication of functions.

  Like a growing global business, the Cartel had gone through a familiar growth trajectory: formation, development, stabilisation and crisis. 2003 was a pivotal year. The crisis was two-fold, involving a combination of more effective policing and usual internal struggles that were threatening to rip the business apart. If the Cartel could work through its problems, it could expect to go through the same cycle again. But this time, the business would undergo the changes at twice the pace. The next decade, between 2003 and 2013, would see as much change as the Cartel had undergone in the previous 30 years.

  But the big words and fancy structures didn’t mean much to the likes of Dylan Porter. Dylan was one of the increasing number of Cartel members to end up in jail. By 2003, there were as many in prison as there were outside. This was the hidden cost of success, the one that the new recruits were never shown. On a personal level, Dylan Porter had to come to terms with life as a long-term prisoner. He soon became pals with some of Britain’s longest-serving and most dangerous villains. Ironically, one of his new friends turned out to be Paul Dye, the heroin baron who’d claimed that the Cartel’s influx of heroin in the early 1980s (and which Dylan had sold) had been part of a government conspiracy. But no matter how interesting the company was, when the conversation stopped and the lights went out, Dylan was alone.

  ‘Anyone reading this might think prison sounds easy,’ he said. ‘Don’t be fooled. You have to walk around every day carrying a knife and be careful not to look at somebody the wrong way, in case you upset them. It’s not a normal way to live, is it? Because in dispersal prisons, people get stabbed because they haven’t let on to somebody; they haven’t said “all right” or “how’s it going” in the morning.

  ‘Crime definitely does not pay.

  ‘I have missed my children growing up, and no matter what I can do, I can never get that time back. Education is the best route in life, not crime.’

  In jail, Dylan kept a diary, which he turned into a 158-page unpublished manuscript called The Belly of the Beast. He wrote it to show his friends and family the reality of prison life. ‘When my kids are old enough, I will let them read it,’ he said.

  For eight years out of his twenty-one-year sentence, Dylan remained a Category A prisoner, considered to be the highest danger to the public. He served time in four out of five of Britain’s maximum security prisons: Whitemoor, Long Lartin, Full Sutton and Frankland.

  Others went the same way. In 1996, John Haase and Paul Bennett had been pardoned by then Home Secretary Michael Howard. Three years later, in 1999, Haase was back behind bars after being arrested on guns and drug charges. In February 2001, inside a courtroom locked down by armed police, he was jailed for thirteen years: seven years for gun running and six years for drugs-related money laundering, after striking a deal with the prosecution to plead guilty to lesser charges.

  Haase had been running guns to Ian McAteer among others. Paul Bennett went on the run after being wanted in connection with a cannabis conspiracy involving gangs from London and Spain. Many of the Cartel bosses would soon learn that Haase and Bennett had been informing on them since the early 1990s. One of Haase’s fall guys remained behind bars, a garage owner from Stockport called Thomas Bourke, who’d been jailed for murder and falsely blamed for smuggling a gun into Strangeways Prison. Bourke has always maintained that he is innocent of the murders, and he and his family, led by his sister Jo Holt, maintain that the gun story influenced the jury into regarding him as a dangerous person and hence contributing to his guilty verdict. They have been campaigning for justice ever since.

  For the time being, Shaun Smith was one of the lucky ones. He was still free. But he felt that he was far from enjoying his luck. The gang war that he was locked into felt like torture at times: misery, bloodshed, looking over his shoulder. On a personal level, he felt trapped in a loveless marriage, wedded to the daughter of the family for whom he acted as enforcer. At times, he said, it felt more like a marriage of convenience, to ally common business interests, than a proper relationship. Later, he would describe the family he worked for as ‘like living in a cult’.

  ‘One day,’ he said, ‘in the very near future, people will get to hear the facts about this family that I was so close to. Watch this space . . .’

  Meanwhile, the gang war would rumble on for years and eventually cost Shaun dearly. It cost him his freedom. Shaun was sent to jail for possession of a firearm that he had got to pr
otect himself against Kallas and his gang. Once inside, then and only then did the real fight begin. Surrounded by enemies and battling for survival, he would have to resort to extreme measures. For the first time in his life, he would be tempted to deal drugs.

  ‘I’d resisted selling cocaine and heroin for 20 years. But now I was faced with a dilemma. My life had fallen apart, and the business that I had worked so hard to build was at risk of collapsing into ruins.

  ‘On the outside, I’d had this big reputation. Now I was contemplating having to do some drastic things to maintain that status while I was in jail. One of the most terrible things was that drugs were being dangled in front of me. By that time drugs had become a very rich and powerful commodity in jail. What people don’t understand is that drugs are far more valuable inside jail than they are outside and that if you can control the supply in jail, then you can become a very powerful figure.

  ‘I’d never been part of the Cartel on the outside, but now I was being put in a position to do it on the inside. The temptation was strong. The big question was – would I give into it? Would I go against the code that I had believed in all my life? That’s another story.’

  With Shaun out of the way, the young pretenders, led by Kallas, saw their chance. They wanted into the Cartel badly and with it access to instant riches beyond their wildest dreams. For someone who had started off by selling drugs on a BMX bike, Kallas had done well. He’d had no backing. He hadn’t come from a big gangster family, nor did he have contacts. But he quickly realised what Kaiser and Scarface had realised 20 years before: most of it was an act anyway. And it was possible to strip away the illusion of wealth and power from the leaders, if you were prepared to challenge them. The likes of Kallas and Kaim had nothing, but they saw this an advantage: the nothingness was powerful. They had no beliefs, no codes, no assets, no organisations, no memberships. That made them nimble and hard to destroy. Kallas began to leap up the rungs in the hierarchy and he ended up in Spain and Amsterdam, where he and his small gang began to deal drugs on a big scale. In a quiet Spanish urban area popular with Brit expats, they rented a large villa and turned it into an HQ from which they became responsible for selling coke in Marbella and tablets in Ibiza.

  The godfathers were in a quandary. Was it better to let them inside the tent and effectively bribe them to stay onside, to placate them by giving up some of their own wealth and power? Or was it better to pick up the baton where Shaun left off and continue the struggle? The situation was further complicated by the entry into the Cartel of a whole new class of entrants who would all have a vote on the subject, including names such as Mikey Wright and David Hibbs-Turner.

  Then there was the bigger picture. Inspired by the success of Kallas and Co., and fuelled by dramatic changes in society and policing, Britain was experiencing a growth in US-style street gangs. Over the next five years, these gangs would try to emulate what Kallas had done on a wider scale: cut the top off the pyramid, redistribute power and money from the traffickers at the top to themselves, the sellers at the bottom. It was a dangerous game. No one knew whether they would succeed. But one thing was certain: it would be a very violent fight.

  The old guard Paul Burly had succeeded in eliminating his direct enemies. But now he risked being overrun by the new threat of street gangs. He’d bought a huge inner-city warehouse with the ambition of converting it into a community centre to help children. But it was surrounded by armed teenage thugs who believed that if they could shoot Paul, they could win his hard-won reputation. To survive, he would have to take them on. One day he hoped to escape his past by emigrating to Australia. But would his past eventually catch up with him?

  Colin ‘King Cocaine’ Smith was sitting pretty at the top of the tree. Curtis Warren was in jail and Smith was now the top dog. But his rise to the top had made him a lot of enemies, not only within the Cartel, but also with contacts in Amsterdam, Spain and South America. Some of them started plotting his downfall. Soon the treason became so strong that it wasn’t a case of ‘if’ but how long would it take and with what weapon.

  By this time, Curtis Warren had served seven years since being busted in Holland in 1996. For killing a fellow prisoner – in self-defence, he claimed – he was jailed for a further four years. To make matters worse, he lost an appeal against his conviction, and Dutch police started to make formal appeals to recover £18 million in assets. One of his main oppos on the outside, a Middlesbrough-based car salesman called Brian Charrington, was deported from Spain to Germany to face drugs charges. He was jailed in 2003 in Frankfurt for seven years. Despite the setbacks, things weren’t quite over for Britain’s richest criminal yet. He had a few aces up his sleeve and he was determined to get out of prison. For the next seven years he plotted relentlessly to this end. Finally, he achieved it. The big question was for how long?

  Warren’s pal Phillip Glennon was jailed for six and a half years after pleading guilty to twenty-five counts of tax evasion and money laundering. Three million was ordered to be confiscated from offshore accounts.

  Fred the Rat was still lying on a sunbed in Spain. Everything was going well. It looked like the man who had founded it all was going to see out the rest of his life in peace. Paul Burly believed that Fred was one of the luckiest criminals alive.

  Paul Burly said, ‘Fred was responsible for starting a drugs ring in Liverpool, which in turn became responsible for 60 per cent or more of the drugs that landed in this country. A man so like, and yet unlike, Curtis Warren, because this man has never been caught, but we in our fair city all know that he is as guilty as sin. Just as the police did but who never did anything about it.

  ‘Even to this present day, the Rat lives on his ill-gotten gains with impunity, in Spain . . . and is not even on the wanted list. So he has no fear of getting his collar felt.

  ‘The only thing he looks back on with distaste is not the misery that he is responsible for, but all of the many, many smacks and hidings that he has had at the hands of people he has sent to jail, or cheated. He got so fed up being floored by people that he once spread the word that he was suffering from the same thing that had killed his brother: cancer! Not that he really cared for his brother, because it is common knowledge that he set the poor man up during a drug-importing operation.’

  But as if to prove that Paul had spoken too soon, fate stepped in to redress what seemed to many like an injustice. Fred’s comeuppance came in the form of the accountant he had employed to manage his vast fortune. One day Fred told the accountant that he wanted all of his assets back, starting with those businesses that were in the accountant’s name. Also, those in the names of third parties and nominee solicitors were to be transferred back to him with immediate effect. He saw no reason, now that he had escaped justice for 30 years, why everything shouldn’t be put under his control. After all, he was a free man with no serious convictions. To all intents and purposes, he was an upstanding member of society. Some of the legit holdings that he owned by proxy had grown into big businesses worth millions of pounds. Liverpool was now a boom city and property was at a premium. Fred had lots of it. Paul Burly told me that for several years, the accountant had been very busy instructing solicitors to ensure that almost all of Fred’s money was tied up, legally. When the time came, the accountant told Fred that he couldn’t have his money. First he threatened to have the accountant killed. Then he threatened to sue. The accountant told Fred that if he didn’t behave, he’d be grassed up. Not to the police: as a de facto criminal, the accountant couldn’t do that. But the accountant threatened to hand over a secret dossier of paperwork that they had compiled for over 20 years to the Inland Revenue.

  ‘They might not be able to prove that you’re one of Britain’s biggest drug traffickers,’ the accountant told him. ‘But they will take every penny you own. You’re going to have to do what I say or I’m handing over every piece of paper I’ve got to the taxman.’ Fred went white. Like always, he decided to suck it up and negotiate the best deal he could
get. The deal hurt. The accountant walked away with a substantial proportion of his net worth. They still remain friends.

  Life went on for Scarface and Kaiser. Kaiser emigrated to South America full-time, where he continues to organise drug shipments to Europe. Scarface bought a house ‘somewhere down south’ in England, where he lives a double life, pretending to be a prosperous businessman while at the same time ‘keeping his hand in’ on the drugs game.

  Poncho said, ‘You wouldn’t know he’s been this big drugs-baron person. He lives in a quiet village with a family and no one knows his true identity.’

  As for Poncho and Hector, they returned to Liverpool. As the drugs scene became increasingly violent and they settled down to have families, they gradually moved out of drug dealing. Today they run a couple of small businesses, enjoy a pint in the local pub and worry about their kids’ education.

  Poncho said, ‘I’ve hardly got any mates from that time because most of them are dead or in jail. I am lucky. I don’t do anything like that now. If the truth be known, some of the stuff that I did – the darker stuff that is, the real bad stuff which I can’t even speak about – is still on my conscience. Some of that haunts me. It had made me think about life. It’s made me humbler and more peaceful.’

  Meanwhile, the Analyst carried on as usual. As the number of killings within the Cartel rocketed, he was transferred to the murder squad. Little did he know that within a few years he’d be investigating the gangland slaughter of the Cartel’s new boss.

  ‘It was good experience,’ he said. ‘I was able to develop my ability to investigate murder. I learned the elements required to investigate a complex murder, from arriving at the scene and having to make the decision that the person had been unlawfully killed through the whole detailed process of the murder inquiry. It provided great satisfaction, to support the victim’s family throughout the investigation and eventually sit with them in court, seeing the person responsible for the murder of their loved one being found guilty and sentenced to life imprisonment. It felt like I could make a difference. It felt as though I could solve a set of manageable problems rather than be faced with an edifice so big that sometimes it felt overwhelming – even though, of course, it wasn’t.