High Court unravels £17 million bank fraud
Posted: 28th February 2017
In one High Court case the owner of a chain of luxury hotels and a dishonest bank employee paid in full for perpetrating an audacious multi-million-pound fraud.
The businessman’s companies had, over a sustained period, received £17 million in unauthorised loans from a bank. The transactions had been put through by a senior banker who had been viewed as a safe pair of hands by his employer, for whom he had worked for over 30 years. Described as something of an enigma, there was no evidence that he had profited personally from the fraud and he could not explain why he had thrown away his career and a great deal of the bank’s money.
The companies all sank into insolvency after the fraud was discovered and the bank launched proceedings against the businessman to recover its money. The Court found that he was not aware that the loans were unauthorised from the outset, but had entered into the conspiracy as his business debts rose above £4 million. From that point onwards, he was perfectly aware that the loans would not have been granted had they been properly applied for.
The businessman was ordered to honour guarantees that he had signed in respect of more than £1 million and to repay loans totalling almost £12.8 million. The bank had already recovered more than £1.25 million from its employee, who had lost his job, his pension and his home.