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Two people were stopped in a car by immigration in Dover late one night bringing in bags with 6,000 £1 coins inside.
But amazingly the pair were allowed to drive away after border officials were told the money was payment for mobile phone sales.
In fact, they were part of a four-strong European gang who then hit London's top casinos with the fake coins.
But by then police believe more than 12,000 had been used by the Dutch-based scammers in just two weeks.
Two of the group - Italian lovers Giuseppe Savoia, 26, and 25-year-old Norma Pitrolo were later caught and convicted on counterfeit charges.
They were both jailed for 10 months – but will be released immediately as they have spent the past five and a half months waiting for the trial at Canterbury Crown Court.
Two others are still being hunt by police.
Prosecutor Bridget Todd told a jury how Savoia and Pitrolo had arrived separately in the UK in July.
She said: "This case involves the smuggling of counterfeit coins into the UK for use in gambling machines in London's casinos.
"This was a sophisticated operation by this gang who were able to get by the security measures inside the casinos, designed to detect fake coins."
She said the fakes were "good quality and weighed the same as a genuine £1 coin".
Ms Todd added most casinos paid out winnings in receipts, which were then exchanged for legitimate UK currency.
But because most casinos do not cash up each night, the fraud went unnoticed for days, the jury heard.
The prosecutor said that on July 14, a Dutch-registered Audi with two passengers -including Pitrolo - was stopped at Dover's eastern docks and staff discovered 6,000 £1 coins in bags in the back seat.
The driver, Ashwin Baidjnath Misier - who has never been charged - was a Dutch national who claimed he had sold mobile phones to a Briton who had paid him with the coins.
He told officers he was bringing the coins back and was going to cash them in at the bank.
"It is a serious matter when people are not able to rely on £1 coins and Euros because it upsets the balance of trade..." - Judge Nigel Van Der Bijl
They were then allowed to travel on as they showed the official a receipt for the phones.
The next day, Pitrolo was seen with another man at London's Hippodrome Casino playing the machines - and netting £177 in winnings.
The next day her boyfriend arrived on a Euro Lines coach at Victoria and the two headed to more casinos at the Grosvenor and the London Poker Rooms – again using fake coins.
Security bosses at the Hippodrome later discovered 2,325 bogus coins had been used – at the London Poker Rooms more than 3,288 coins had been used in machines.
Ms Todd said the fakes made up 91% of coins used in the machines on one day.
Police believe Pitrolo bagged £923.44 in winnings and her fiancé £3,753.23 – none of which has ever been repaid.
Judge Nigel Van Der Bijl told the couple: "It is a serious matter when people are not able to rely on £1 coins and Euros because it upsets the balance of trade."
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