Three men from Wolverhampton have been arrested on suspicion of involvement in an £800,000 fuel laundering operation.

Officers from HM Revenue and Customs (HMRC) and West Midlands Police undertook searches at two domestic premises and an industrial unit in the city on May 22. The investigation centres on the purchase of rebated kerosene and its sale to motorists as duty-paid road diesel.

Around 1,500 litres of kerosene was removed from the industrial site, along with storage tanks, a fuel pump and 8,000 fake Viagra tablets. Eight vehicles were seized from people who were using vehicles fuelled by kerosene.

The three arrested men, aged 52, 24 and 22, were questioned and released on bail until August. Investigations are continuing.

Colin Booker, assistant director, HMRC said: “Using illicit fuel may seem like a bargain, but it deprives the government of tax revenue, and puts honest road fuel retailers at risk. But it’s not just about duty - kerosene can damage a vehicle’s engine, and the process of storing and selling illicit fuel from a makeshift ‘huckster’ site could potentially damage the environment.

“Anyone with information about fuel fraud can contact the Customs Hotline on 0800 595000.”