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Six face jail over biggest-ever UK mortgage fraud

Tuesday, 25 January 2011 4:17 PM

Southwark County Court heard today that six solicitors had committed one of the largest mortgage frauds ever perpetrated in the UK, having borrowed almost £50 million against properties worth only £6 million.

It is alleged that, acting on behalf of various businesses, Laurence Ferrigan, Mark Knight, Simon Lawrence, Kamran Malik, Fatema Patwa and Hardeep Sodhi bought six properties and subsequently sold them back and forth between the different companies, driving up the value each time.

Chartered surveyor Ian McGarry also made valuation reports including false leases, which increased the properties' values even more.

According to Andrew Baillie QC, the effect of this activity was to persuade banks and building societies to lend a total of £49,287,000 over the 13 months from February 2005 to March 2006. He said: "This is not an 80 per cent or 90 per cent mortgage but, taking all of these loans together, it was the equivalent of an 866 per cent mortgage. It must be one of the largest mortgage frauds ever perpetrated in the UK."

Baillie added that by the time the lenders realised that the properties were worth only a fraction of what they had been led to believe, it was too late: much of the cash had been sent abroad and "the banks were left to whistle for their money".

With all six solicitors having denied obtaining money transfers by deception, Baillie concluded: "The question that this trial has to address is whether each of these defendants is guilty of acting fraudulently."

McGarry has already admitted two counts of conspiracy to defraud and four counts of obtaining money transfers by deception.

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