TWELVE members of a criminal gang have been sentenced for a tobacco smuggling scam which cost the taxpayer more than £1m.

The network posted hundreds of parcels of hand-rolled tobacco from Belgium and Holland to addresses in Darlington, North Yorkshire, County Durham, and Teesside to be pedalled on the black market in the North-East.

The packages were disguised as plant pots, fabrics, decorating, gardening and catering supplies and amounted to more than six tonnes in illegal tobacco.

Teesside Crown Court heard that one defendant, David Hodgson, who admitted being knowingly concerned in the fraudulent evasion of duty, used some of the profits to gamble more than a million pounds in betting shops, despite being in receipt of benefits.

The 68-year-old, of Oaktree Court, Catterick, along with two other defendants who also admitted their involvement, will be sentenced at a later date after being remanded in custody.

Parcels linked to the gang were intercepted at ports across the country, while text messages found on mobile phones referred to the supply and sale of "baccy".

Judge Sean Morris, who commended the “splendid” work of customs officers in bringing down the operation, told the defendants: “Every illegal fag that is rolled is ripping the heart out of the Treasury’s coffers.

“People who rip off their fellow citizens by stealing from the Revenue are affecting the health and welfare of others.”

Those who admitted conspiracy to evade duty between July 2012 and August 2013 and the sentences they received are

:: Paul Stephen Hooper, 53, of Appleton Close, Darlington, who was jailed for four years, seven months

:: Paul Hodgson, 46, of Forest Drive, Colburn, Catterick, who was jailed for four years, ten months

:: Joshua Hodgson, 24, of the same address, who received three years

:: John Hodgson, 45, previously of Norman Road, Richmond, North Yorkshire, now of no fixed abode, four years, ten months

:: Daniel Keith Whitmore, 26, of Pensbury Street, Darlington, two year suspended jail sentence

:: Ashlea Kirk, 45, of The Potlands, Leeming Bar, two year suspended jail sentence

:: Russell William Blakeburn, 60, who lives in Spain, 250 hours unpaid work

Other defendants pleaded guilty to being “knowingly concerned” in the fraudulent evasion of duty.

They are

:: Ian George Gregory, 60, of Bevanlee Road, South Bank, Middlesbrough, who received a five month suspended jail sentence

:: Teesside University student Angela Marquis, 38, of Stuart Avenue, Richmond, who received a 12 month suspended jail sentence

:: Joanne Haxell, 35, of Milltop, Richmond, who was given 250 hours unpaid work

:: Trevor Seal, 44, of Front Street, Appleton Wiske, North Yorkshire, who received 200 hours unpaid work

:: Deborah Bowie, 40, from Wakefield, West Yorkshire, who received 250 hours unpaid work.

John Hodgson, his brother Paul Hodgson and Hooper were described as "key players" in the plot, regularly travelling abroad to buy hand rolling tobacco before posting it to accomplices across the region.

Diane Donnelly, operational leader, with HMRC's fraud investigation service, called those involved "greedy crooks".

She said: “This was an organised and sustained attack on the tax system, devised to deprive the public purse of duty."