‘Greedy’ financial advisers in £4m mortgage loan scam
AGROUP of financial advisors who were “motivated by greed” and secured £4m of loans on the back of fraudulent mortgage applications have been jailed.
Seven defendants were sentenced at Cardiff Crown Court for their part in a dishonest criminal enterprise which used fraudulent mortgage applications to defraud lenders to the true financial circumstances of the application.
Between June 1, 2009, and September 1, 2013, Peter Gay and Robert Maxwell ran the operation and were joined by Kenneth Bacon, 66, who supplied false accountancy documents required for the applications.
Gay, 64, who worked as business development officer at Abbey National in Neath, provided false payslips and Maxwell, 70, a
director of LRP Mortages based in Newport and worked as a financial advisor for Aspect Financial Services, processed the applications.
Malcolm Pow, 47, who has a background in financial services, took advantage of the dishonest enterprise to process applications made by his clients using false documentation.
Michael Bishop, 39, used Gay to fraudulently obtain documents in an application to Yorkshire Building Society. In that application he used false documents to inflate his business profit figures to make his business more attractive.
Another defendant Supriya Misra used their services to process applications for his clients while Omer Mian, 45, provided false employer references if required.
Between the defendants, more than 80 fraudulent applications were made, half of which were unsuccessful, with loans of £4m granted and loans of £5m not successfully obtained.
Speaking at the hearing, prosecutor Jonathan Rees said: “The scale of the offending motivated by their own greed is overwhelming.”
Illustrating how the enterprise worked in practice, Mr Rees added: “In December 2001, Mr Gay emailed Mr Maxwell about a client. He said ‘This is the application we spoke about and it needs a couple of important changes, I’m not sure what to do about employment, he works for the company mentioned, a restaurant chain in London. However, he would need £70,000 plus to afford the loan. We could put him in as a director of the company and see if it works, let me know what you think.’
“Mr Maxwell replied ‘I have shown him as a director of the company with a salary of £75,000. I’m at home now so can’t print off the certificate. It asks for two years worth of accounts or latest payslips’.”
Among the false documents used by the court were false proof of income documents, false payslips, false accountancy certificates, false references, false business accounts, and false references from employers and employees.
Concerns were raised after Maxwell’s employer was contacted by Santander over issues with a number of applications.
He was arrested in January 2013 and searches were made of his home and offices where documentation was found in relation to applications for Gay and he had forwarded a number of documents to Bacon, relating to proof of income documents.
When Bacon, a member of the Institute of Charted Accountants, was arrested in connection with the fraudulent applications, it was discovered that a number of accountancy certificates were signed by an ex colleague of his called Michael WH Lloyd, who had no knowledge of the certificates, and were used to help process mortgage applications.
Another defendant Bishop, owned a company called Seven Financial based in Whitchurch, Cardiff, where he worked as a managing consultant.
He received a loan from Yorkshire Building Society as a result of receiving false documents from Gay and Maxwell which enabled him to inflate his profit figures.
Gay later pleaded guilty to four counts of conspiracy to defraud and one count of supplying an article for use in fraud; Misra pleaded guilty to four counts of conspiracy to defraud; Pow pleaded guilty to one count of conspiracy to defraud and Mian pleaded guilty to one count of conspiracy to defraud.
Maxwell was convicted of four counts of conspiracy to defraud, Bishop was convicted of conspiracy to defraud and one count of fraud by false representation and Bacon was convicted of three counts of conspiracy to defraud and eight counts of making an article for use in fraud.
Sentencing, Judge Michael Fitton QC said: “Each of you had your own personal reasons for allowing your high professional standards to fall by the wayside. It give me no pleasure or satisfaction to see the dock filled with men of ability, some intellect, many qualifications, potential and of good character with a number of powerful references which have been written.
“The fact you have had to call on members of your family and social acquaintances to render to you what service they can by expressing their own personal belief in you, is to show how low you have come at this pass but you have brought your own fate entirely on yourselves.
“You’re going to bring misery on your wives, children and parents who will be deprived of the support they deserve from you at this stage.
“Some of you have begun to recognise the nature of you conduct and some of you have begun to show some level of remorse, but some of you who pursued this to trial were blindfolded by your own arrogance and you belief you could cont the jury that what you did was permissible and the result of being deceived by others. You didn’t fool the jury and you don’t fool me.”
Gay, of Ffordd Morgannwg, Whitchurch, Cardiff, was sentenced to a total of three years and nine months imprisonment.
Maxwell, of Richmond Road, Six Bells, Abertillery, was jailed for five years and six months.
Kenneth Bacon, of Llandissilio to Glandy Cross, Efailwen, Carmarthenshire, was sentenced to five years imprisonment.
Malcolm Pow, of Heol Tonwy, Caldicot, Newport, was sentenced to 26 months imprisonment.
Michael Bishop, formally of Cardiff but now of Tan Quee Lan Street, Singapore, was jailed for four years.
Supriya Misrea, Cwrt Coed y Brenin, Church Village, Pontypridd, was sentenced to 33 months imprisonment.
Omer Mian, of Conway Road, Newport, was jailed for two years