Sunday, July 15, 2012

The Vegas Trust - The Fraud that had everything! Part Three.


I called the metals broker and invited him to present himself at the Fraud Squad for interview. He came in alone. I asked him if he wanted a solicitor present. '...No...' he said, '...I just want to get this over with...' His story was pathetic. He was a washed up metals trader who had never really made any big money. At a time when it was almost impossible to work trading commodities and not make a fortune, this marked him out as a real loser indeed. He had met the Dutchman who offered him the role trading a metals fund, and offered him enough money to pay his outstanding debts and try to save his marriage. He had jumped at the chance. He knew it was illegal, and he thought all that screwing around with the invitation document and the visits to the barrister were a waste of time and money. '...I know enough about the PFI...' he said, '...to know what we were doing was wrong, but when the brief said to give it a run anyway, I thought hell, why not...'
I told him I had uncovered the ruse with the trade statements, and he just hung his head. '...To be honest...' he said, '...I didn't think that was wrong, it goes on all the time in metals trading. You trade so many lots you often end up with an exposed open position, so you put through a wash trade to cover your book...'
I pointed out that this time, he had been misleading investors into believing a false set of circumstances which was fraud, and he agreed this was very likely. '...I'm really sorry...' he said '...I was desperate, how long will I get...? Then the floodgates opened. '...I never made any money out of this, I only got a small draw for salary. That bloody solicitor, he has enjoyed the money though on that Amex card we got him, he loves that bloody piece of plastic...'
I said nothing but made a calculated gamble. '...I am going to release you now on bail to come back in 4 weeks time. When you come back bring a solicitor with you so I can talk to him...'
When he had gone I rang American Express Card Security. In those days most of the security team were ex-Metropolitan Policemen, and we had an open liaison conduit to them because we were always dealing with stolen and forged Amex cards.
'... Did they have a card registered in the name of The Vegas Trust, or Baraquesa Finance or even, I named the solicitor ...?'
'...Yes, an Amex Gold Card, in the name of the solicitor and the name of his solicitor's firm. Issued in Zurich, and paid for by cheques on an account in the name of the Baraquesa Finance Corporation drawn on a Guernsey bank. The accounts were sent to an address of an accountants' firm in St Peter Port. Paid regularly, large sums, every month on the dot, cheques signed by the solicitor...'
'...Would it be possible for me to have copies of the payment vouchers, the bills and the cheques used to pay them...'
'...Of course, we'll drop them round in a hour...'
When they arrived, I looked through them. Wow, this man was using a lot of money to live very high on the hog indeed. Expensive restaurants, antiques purchases, theatres, designer clothes, and every bit of it completely invisible to any routine enquiry. The card was administered in Switzerland, the bills sent to the offices of an accountant in an offshore tax haven, who would always claim client privilege, and paid for by this man flying once a month to Guernsey, sending off a cheque back to Amex Zurich, having a very expensive seafood lunch and then flying back to London. I could see all these transactions on the card itself.
I was elated, I had the evidence to put this corrupt bastard behind bars where he thoroughly belonged. I rang him at his offices and asked him to come in to see me. '...I am afraid that won't be possible...' he said, '...I cannot answer any questions about the running of these companies as any information I possess is completely covered by client privilege, you would be wasting your time trying to talk to me...' I asked him a second time, and again he refused. The third time I asked him he still refused, so I asked him to fax me a statement to that effect.  It dutifully arrived about 20 minutes later on his headed notepaper, saying he was unable to discuss any matters because of client privilege. However, I had a minor victory, I had just neatly finessed out of him a written admission that he was the solicitor to the whole sorry mess.
With a colleague, we drove over to his offices, where I arrested him in the front lobby, making very sure that everyone there heard my words including my use of the formal caution against self-incrimination. I asked him if he wanted someone else to be present when I interviewed him and he nominated a young partner, who came with us back to the Fraud Squad.
We used one of the taped interview suites. I was a huge fan of taped interviews because they saved so much hassle in court with barristers suggesting that certain questions or certain answers had not been asked or given. He began very pompously, making a statement that he was outraged to be arrested in his own offices, and that he would be making a formal complaint about me to the Complaints Bureau. He reasserted that he couldn't answer any questions about the business as it was all covered by client privilege.
I wrote down the address of the Complaints Bureau for him and then asked him a simple question. '...How do you account for expenses in your general practice...?' He made some bland statement. '...Do you use a credit card issued by your firm...' '...No...' '...Have you ever been issued with a credit card by your firm...?' '...No...' '...Then can you explain these...' and I dropped on the desk the complete bundle of photocopied account statements, vouchers, and paid cheques.
There was a terrible silence, and he went ashen. I thought he was going to pass out. Looking at his partner, the man was sitting shell-shocked, and slowly put his head in his hands.
I asked him again to explain them.
'...How did you get hold of these...you shouldn't be able to get these documents...' he blurted out!
His partner now urgently whispered in his ear, and then said '...I have advised my client to say nothing more...'
That suited me down to the ground. The tape when I replayed it was explosive. Any jury being asked to listen to it would have no doubt of this man's complete guilt.
So, to recap, I now had evidence that the whole case was a fraud from start to finish, and that this corrupt man had benefited richly from the monies deposited by the clients. I could prove conspiracy to defraud, any number of instances of obtaining money by deception, to say nothing of the offences under the PFI Act. I was home and dry!
Or so I thought.
I was hoping that when the solicitor was convicted of these frauds, his losing clients would all be able to sue him for their losses, and the evidence of his conviction for offences of dishonesty would make the civil actions a mere formality. He would be bankrupted, which he thoroughly deserved. If he didn't have enough to pay back the losses, then the losers would be able to sue his partners and the practice, because being solicitors' partnerships meant that they were all jointly and severally liable for losses incurred by the firm as a whole. So they would have to invoke their liability insurance to pay the claims, which would prove to be very expensive, and would cost each partner a lot of money.
I wasn't about to lose a minute's sleep over this likelihood, as far as I was concerned they had it coming, it was the moral price they had to pay for employing a sleazebag like this arrogant man.
What I had not fully appreciated was at the moment the solicitor left my office, his part in the case became a complete irrelevancy. From that moment on, everything that was about to fall on my head was all aimed at finding ways to protect the legal partnership and prevent anyone from being able to sue them.
I was almost immediately served with a writ demanding that all the documents seized by me from the office search be returned to the company so that they could wind the company up in an orderly manner. I refused to part with the documents because they would have been used by other interested parties to begin to cobble together a defence to the allegations about the trading methods. I realised, no-one else knew what was in these papers so they needed to get them back.
At the hearing in the High Court, the Judge agreed with our arguments and refused the application. In panic, they then rushed off to the Court of Appeal and demanded that we give them copies of the documents. I refused again for the same reasons. However, the law as it then stood meant that I had to give them copies. I was trying to buy enough time for the DPP to decide on the suitable charges to bring against the solicitor and the trader, because after that they would have been given copies of the documents anyway.
The Court of Appeal, very grudgingly, found for the appellants, and agreed that copies should be handed over, but deferred the date of delivery for a month, by which time they opined, the DPP should have been able to decide on the relevant charges. The judge giving the judgement said that they found that no criticism or blame could or should attach to the detective in the case, or the Commissioner, which was a blessed relief!
The next move was that Sir David Napley, the country's leading criminal solicitor demanded that I hand over all the evidence in my possession against the solicitor, for whom he was now acting. I refused on the grounds that until the DPP made a decision as to charges, he was not entitled to see the evidence. The DPP let me know that they wouldn't force me to hand over the evidence, but this did not stop Sir David from still lobbying them hard for me to give up all the evidence against his client. He argued that it was no light decision to prosecute a solicitor, and the evidence should be properly scrutinised before charges were brought. This was an unheard-of move, it had never happened before in my experience, and again I refused to give up the documents.
Almost immediately, one of the chief Inspectors, my leading tormentor in the Department ordered me to hand over the papers. When I argued that he had no authority to order me to do something the DPP had said he would not force me to do, I was told I would be suspended if I refused this order. Rather than face the likelihood of suspension and having my case which was so close to being finalised, taken off me and ruined, I handed over the evidence to Sir David.
Within a few weeks, Napley's office sent back a statement, written by the solicitor in which he purported to make a full explanation of how and why he had used the credit card and stating that it was all done with the permission of his clients. It was all complete rubbish, but it actually played into my hands because I was able to prove that he had lied in his own voluntary statement, which subsequently turned it into a toxic weapon against him.
In the end, the solicitor and the metals broker were eventually charged with a large number of charges starting with conspiracy to defraud, followed by a long list of charges of obtaining property by deception, and finishing up with two charges of possessing and issuing documents contrary to the terms of the PFI Act. After a lengthy committal case, he and the broker were committed to stand  trial at the Central Criminal Court on a lengthy indictment. Ironically, while the solicitor was being charged, a routine Criminal Records check proved that he already had a string of previous convictions for offences which should have been disclosed to the Law Society's Disciplinary Body, but for which he had used an alternative combination of his names, and of which they had no knowledge.
So, by this time, I had learned that the derivatives trading business was an utterly corrupt market, run by and in the interests of the few, and that documents required for accounting purposes were routinely made up to cover embarrassing situations. I had also learned that the law will be twisted and that solicitors will use every dirty trick they can find in order to protect their clients when they face serious fraud charges. I had learned, that civil court cases will be used to occupy the time of investigating detectives, bringing huge pressure on them, when they should be focusing on getting evidence to prove a criminal case properly, and that both barristers and solicitors were happy to take these instructions even though the highest degree of likelihood existed that they were being paid with money unlawfully acquired from innocent investors.
Nevertheless, I had won through despite everything, bent solicitors, incompetent and arrogant and overbearing senior police officers, pompous, bullying defence lawyers, I had survived and my case had got to trial at the Central Criminal Court. Now there would be no turning back, and I was very confident that we would win, and win hard! I thought that nothing else could go wrong, but even worse was to come, an event which completely dumbfounded me then, still confounds me now, and destroyed any sense I might have had of the honesty of the English Judicial system, and how it will be abused when persons from the upper socio-economic group are involved.
This will be covered in the final blog in this case.

1 comment:

AbogadoNZ said...

Is it a matter of public interest to name the firm involved? Well done Rowan. Whatever the outcome the moral victory is yours. Careless leaking of the names would surely be a safe strategy as the likelihood of a writ for libel would fail (truth defence) and incriminate the plaintiff. Like you I share the view that the great and the good are anything but. I have come across numerous examples of criminal behaviour by solicitors and it goes unnoticed and unreported.