A guilty plea entered today at Southwark Crown Court completes the prosecution of six defendants over two trials in a £4 million commercial loans advance fee fraud between 2006 and 2009 operating as Gresham Ltd.
With reporting restrictions now lifted the convictions of Edward Davenport, Peter Riley and Borge Andersen in May can now be published alongside the convictions of David Horsfall , Richard Stephens and David McHugh who all pleaded guilty before the second trial, due to commence today.
Trial 1
The first trial, presided over by HHJ Testar, involved the three defendants who directed and operated the fraud, Edward Davenport, Peter Riley and Borge Anderson.
They were the driving force behind Gresham Ltd, a company promoted falsely by them as a long-established, wealthy and prestigious financial organisation capable of lending hundreds of millions of pounds as venture capital.
The three were convicted on 19 May of conspiracy to defraud. Sentencing was held over until 1 September. Davenport and Riley were each sentenced to 7 years, 8 months and disqualified from acting as company directors for ten years.
Andersen’s sentencing was adjourned awaiting a pre-sentencing medical report and on 12 September he was sentenced to 3 years, 3 months and disqualified from acting as a company director for 7 years.
The SFO will seek Serious Crime Prevention Orders against all three defendants. Confiscation proceedings will also be taken against all three defendants.
Trial 2
The second set of proceedings under HHJ Higgins involved a solicitor and two individuals purporting to be professional advisors engaged by Gresham to support the façade.
David McHugh, an individual with several previous convictions for dishonesty, posed as both a lawyer and accountant in order to deceive investors.
Richard Stephens posed as a surveyor to convince investors their projects were being properly considered. David Horsfall, a solicitor, provided misrepresentations to investors as to Gresham’s ability to advance loans.
David McHugh and Richard Stephens pleaded guilty to conspiracy to defraud. David Horsfall pleaded guilty to fraud by false representation, contrary to s1 of the Fraud Act 2006.
These defendants will be sentenced on 10 November 2011.
The Director of the SFO, Richard Alderman, commented:
“This was a proactive investigation that stopped a sophisticated criminal enterprise in its tracks.
"The time taken from the commencement of the investigation to trial was a little over fifteen months and demonstrates the SFO’s commitment to reducing the time taken to bring cases before the Crown Court.”
In passing sentence in trial 1, HHJ Testar described the Gresham operation as a “professional and sophisticated fraud that did a huge amount of damage…victims suffered crippling losses”.
He described Riley as “a very accomplished con-man…at the sharp end of the fraud” who had “spun a web of elaborate lies to explain why the money had not come. It was one fictitious charade after another” and enabled Riley to enjoy “a dolce vita life”.
The judge described the SFO’s description of Davenport as “the ringmaster” as “justified”. He said that Davenport was in overall charge and though he worked in the background (“he doesn’t leave footprints in the snow”) he was the instigator and the instructor.
Andersen was described as a less senior participant, receiving less benefit and that “the fraud was already a runner” before he joined Gresham.
