The drug gang boss who had a fling with his prison governor

The inmate who a prison governor began a relationship with was a notorious criminal who ran his drugs empire on the encrypted messaging service Encrochat.

It was Anthony Saunderson's use of Encrochat which provided evidence of his relationship with Kerri Pegg - leading to her conviction too.

When conducting his "business", Saunderson used the aliases Jesse Pinkman - the meth dealer in the Breaking Bad television series - and James Gandolfini, the acclaimed actor who played Mafia boss Tony Soprano.

He used modified smartphones, selecting Encrochat - an encrypted communications platform - as a means to communicate with members of his criminal network.

Hailing from Formby, Saunderson had been one of Merseyside's most wanted fugitives for his part in importing £19m of cocaine in shipments of corned beef from Argentina.

But the net eventually closed in around him and he was arrested by police in May 2014, and jailed that November for 10 years after being convicted of drugs and money laundering offences.

Just short of three years into his sentence, in June 2017, Saunderson was transferred to HMP Kirkham, an open prison situated between Preston and Blackpool.

While there, he met governor Kerri Pegg, 42, described at her Preston Crown Court trial as a "rising star" of the Prison Service.

From the start of her time at the jail there were concerns about Pegg being inappropriately close to Saunderson.

The court heard Pegg and Saunderson spent a lot of time together in her office and, in October 2018, he put in a request to be released on temporary licence.

Jurors were told she broke prison rules by approving Saunderson's temporary release from custody, without proper authority.

There are specific rules for how such applications must be processed and Pegg broke them.

She did not have the authority to approve his release, but did so anyway and without notifying the relevant official.

In May 2019, Saunderson was out of prison.

He was developing and delivering a programme called Beating Alcohol and Drug Dependency (BADD) for inmates at several prisons.

Meanwhile, Pegg said she was co-ordinating the drugs strategy of six jails in the north-west of England.

Pegg entered Saunderson's details into her phone and they remained in contact.

In court, she tearfully claimed that while she had been "hands-on" and "stupid" in her professional interactions with Saunderson, she had done nothing wrong.

Pegg's barrister said she had been "naive".

The prosecution demonstrated she had spent more and more time with the drugs boss as he came towards the end of his 10-year sentence.

Jurors were also shown some size 10 Hugo Boss flip-flops that had been found in her Wigan apartment, as well as a toothbrush, designer clothes, shoes and jewellery.

Saunderson's DNA was found on the toothbrush and the flip-flops.

While working on the BADD programme, Saunderson became involved in another drugs plot - just two months after he was released on licence.

In 2022, Saunderson was unmasked as one of nine gangland figures responsible for producing amphetamines on an industrial, multi-million-pound, scale at premises in Sealand, Flintshire.

In August of that year, he received a 31-year prison sentence for producing and dealing amphetamines as well as trafficking heroin, cocaine, cannabis, ketamine, MCAT and diazepam.

He was also sentenced to an additional four years behind bars for conspiring to sell or transfer guns.

Saunderson's downfall followed a lengthy joint operation between North Wales Police and Merseyside Police.

Operation Blue Sword, which began in early 2020, unearthed the distribution of controlled drugs across England, Wales and Scotland.

The North Wales plot was rumbled by police eavesdropping the gang's electronic communications on EncroChat.

Meanwhile, Merseyside Police discovered a storage unit in Aintree in which they said the gang were keeping large amounts of chemicals and equipment.

The gang's Encrochat communications also ultimately led to Pegg finding herself in the dock, her high-flying career and reputation lying in tatters.

Pegg's denials of wrongdoing were cast into doubt when it emerged that even members of Saunderson's gang had grumbled about their boss spending too much time with her, and away from his "work" and wife.

The jury were also told Pegg swapped her Honda Jazz for a £12,000 Mercedes C class car, which Saunderson paid for in drugs - namely 34kg (75lb) of amphetamines.

On 6 April 2020, Saunderson was sent a message saying "car her (sic) for ya bird 12 quid or work", the Crime Prosecution Service said.

"12 quid" in this criminal context means £12,000 and "work" means drugs.

On 11 April Saunderson was joking with associates on Encrochat about driving around with "Peggy" in her new car.

When Pegg was arrested in late 2020, the car was found parked outside her home.

Earlier, Pegg, was found guilty of two counts of misconduct in a public office and one count of possession of criminal property, the Mercedes car.

Judge Graham Knowles KC told Pegg to expect a custodial sentence, adding: "I have no choice but to send you to prison due to the gravity of your offending."

Speaking of Saunderson's offending, Det Ch Insp Lee Boycott, of North Wales Police, said: "The criminal gang produced amphetamine on an industrial scale.

"The evidence gathered as part of the investigation revealed that, between April and June 2020, the quantities of controlled drugs produced [were] eye-watering.

"The Sealand illicit lab converted 2.6 tonnes of raw chemicals into controlled drugs.

"Over that three-month period, it is estimated that the gang produced over 900 litres of amphetamine oil and over 700kg of amphetamine, with an estimated wholesale value of around £1 million."

Listen to the best of BBC Radio Merseyside on Sounds and follow BBC Merseyside on Facebook, X, and Instagram. You can also send story ideas via Whatsapp to 0808 100 2230 and watch BBC North West Tonight on BBC iPlayer.