Two jailed for £50m mortgage fraud
A chartered surveyor and property investor have been jailed for a total of 20 years after admitting their role in a huge £50m commercial mortgage fraud.
Ian McGarry, a former chartered surveyor and director at Dunlop Haywards Lorenz, from Hertfordshire, and Saghir Ahmed Afzal, from Birmingham, were sentenced at Southwark Crown Court this week to 7 and 13 years’ imprisonment respectively. Judge Beddoe, sentencing the pair, said Afzal had orchestrated with his brother a “massive and carefully-orchestrated confidence trick” over a period of two years, defrauding the Cheshire Building Society, Bank of Ireland, Société Générale and the Nationwide Building Society out of almost £50m.
Judge Beddoe said that the value of the fraud meant that the case was off the scale in terms of the sentencing guidelines for fraud cases, not least because very little of the money had been recovered. The Judge described McGarry as “vital” to the fraud, and branded his involvement as motivated by “rampant greed”. These convictions came after a long running investigation which began in 2006 when an anonymous tip off brought the pair to the attention of the West Midlands Police. The investigation was later taken over by the Serious Fraud Office (SFO).
Afzal and McGarry were charged along with six former solicitors in 2009. Afzal and McGarry pleaded guilty to all six charges against them prior to the trial of the former solicitors beginning in January 2011. Afzal and McGarry both pleaded guilty to two counts of conspiracy to obtain money transfers by deception and four counts of obtaining a money transfer by deception.
The fraud revolved around McGarry providing Afzal and his brother Nisar Ahmed Afzal with false valuations based on fictitious leases, which were used to support fraudulent mortgage applications on six properties. These false valuations were then used by the Afzals to deceive lenders to lend almost £50m on properties which were worth only £5.6m. In one case, McGarry was proven to have valued one property at £19m which had been purchased earlier for just £1m. In another instance, McGarry produced three difference valuations of a single property on the same day, for three separate lenders.
Saghir Afzal was found to have personally benefited from the fraud and sent more than £26m back to Pakistan, where it remains under the control of his brother, Nisir Afzal, who is still at large and being sought.
Of the six solicitors also tried for conducting the property transactions on behalf of the Afzals and McGarry, three were acquitted of the charges against them and, the jury were unable to reach a verdict in respect of the other three. Following these verdict, the SFO decided it was not in the public interest to seek a retrial of the remaining three defendents.
Cases involving solicitors and other professionals being charged with mortgage frauds are more and more common these days, not least because of the increased powers of the SFO as well as new legislation including the Proceeds of Crime Act. Such cases require specialist defence lawyers due to the volume of information and the intricacies of the cases. Despite the legislation, we are finding that more and more professionals such as solicitors, financial advisers and bank managers are being prosecuted for frauds about which they knew nothing at the time. It is common for fraudsters to target these rofessionals to give an appearance of legitimacy to their operations. It is therefore essential when faced with such charges that you choose a defence team who specialise in this area of the law and who can offer you the attention to detail and experience required to assess the evidence and provide a meaningful and effective defence. We at Mansouri & Son Solicitors specialise in defending professional clients faced with allegations and charges of mortgage fraud. If you are facing such cahrges we would like to hear from you in strictest confidence. Call a member of our criminal defence team on 020 8401 7352 to discuss what we can do to assist you.