Landmark land banking fraud case successfully prosecuted at Southwark Crown Court
A gang of fraudsters who cheated millions of pounds from investors in a land banking scam have today (Friday 8 March) been successfully prosecuted at Southwark Crown Court.
In a joint operation between Tower Hamlets Council Legal Services, Tower Hamlets Trading Standards and the Metropolitan Police, three men have been found guilty of a land banking fraud worth £35.8 million.
On Wednesday 6 March 2013, Mr Daniel Webster (23.06.1983, age 29), Mr Stephen Allan (23.10.74, age 38) and Mr Steven Ronald Percival (22.07.1983, age 29) all from Bromley, Kent were found guilty at Southwark Crown Court of conspiracy to defraud, contrary to common law. All three had pleaded not guilty to the charges. A fourth defendant, Christopher Demetriou (15.01.1983, age 30) from Ilford, Essex pleaded guilty to conspiracy to defraud offences before the trial began.
At a sentencing hearing on Friday 8 March at Southwark Crown Court, before HHJ Beddoe, Christopher Demetriou was sentenced to six years and four months in prison; Daniel Webster was sentenced to six and a half years in prison; Stephen Allan was sentenced to seven and a half years in prison and Steven Percival was sentenced to six and a half years in prison.
They are also subject to a disqualification order under the Company Directors’ Disqualification Act with Christopher Demetriou disqualified for ten years, and Webster, Allan and Percival disqualified for eight years each.
Summing up, the Hon Judge Beddoe, said it had been a grotesque, cynical merciless fraud.
The gang had carried out the fraud through a business based in Canary Wharf between 1 January 2005 and 31 August 2010. They had conspired together, and with other persons, to defraud investors to part with moneys for the purchase or intended purchase of plots of land which were being marketed through entities called Countrywide Land Holdings Limited, Countrywide Land Holdings, and Regional Land. In all cases these plots of land were worth little or nothing to the investor.
In a trial lasting seven weeks, the jury heard from over 40 witnesses from all over the UK who had been duped into buying the land from the defendants. Over the whole period some 400+ plus investors were deprived of around £35.8 million.
The fraud was identified by Tower Hamlets Trading Standards following concerns about the number of complaints they were receiving about the businesses registered to the defendants. The case was referred to the Trading Standards Regional Fraud Unit (TSRFU) in the summer of 2010.
The prosecution follows a long investigation carried out by Tower Hamlets Trading Standards and the Metropolitan Police. A significant contribution towards the legal and trading standards costs were funded from the recently set up National Trading Standards Board. The case is the biggest investigation that has ever been undertaken by Tower Hamlets and is one of the largest criminal fraud cases brought before the courts by any Local Authority.
Consumer Minister Jo Swinson has welcomed the prosecution, saying: 'Today’s decision by the Crown Court is a great win for Trading Standards. This shows that scams and frauds, no matter how big or small, will be punished. The sheer level of deception by these fraudsters shows just how far criminals will go to take advantage of honest hard-working people.
'I welcome the result and the hard work of Trading Standards with support from the National Trading Standards Board to get justice for the victims. I would urge anyone who suspects a scam is taking place to contact the Consumer Helpline on 08454 040506 or visit their website www.adviceguide.org.uk. With help from consumers, we can stamp these illegal practices out.'
Mayor of Tower Hamlets, Lutfur Rahman, said: 'This case sends out a strong message that fraud will never be tolerated in Tower Hamlets. Cutting crime is one of my priorities and we will always be vigilant on criminal activities operating in the borough. The defendants in this case preyed on innocent investors with blatant disregard to the consequences for them.'
Deputy Mayor of Tower Hamlets, Cllr Ohid Ahmed, said: 'The outcome of the case is satisfying and is justification of the hard work and determination of our Legal Services and Trading Standards Team working along with our partners in the Metropolitan Police and National Trading Standards Board.'
Detective Inspector Simon Pollock of the Metropolitan Police, said: 'A significant multi-agency investigation led to these court results. Innocent investors were exploited for the personal financial gain of those convicted.
'We will now be using our powers under the Proceeds of Crime Act to ensure they are stripped of their criminal benefit and victims are compensated as far as possible.
'When considering investment opportunities please think carefully and seek independent advice before proceeding.'
Chairman of the National Trading Standards Board (NTSB), David Collinson, said: 'This is a fantastic trading standards result in a sophisticated nationwide fraud case and we applaud the hard work that has gone into securing this result over the last two years.
'This land banking fraud worth £35.8 million is the largest ever case taken on by Tower Hamlets trading standards with national implications and an attached cost disproportionate to the authority's size.
'This is a prime example of the type of large-scale scams that the NTSB was created to help tackle – funding from us in carefully identified investigations will give trading standards the resource they need to take on criminals who are causing damage way beyond local authority boundaries.'
To report investment scams or concerns contact Tower Hamlets Council's Trading Standards Team on 020 7364 5008.