Two businessmen have been jailed after they defrauded banks of over £740m by using forged documents to secure loans to acquire a 16-property portfolio.
Achilleas Kallakis has been sentenced to seven years in prison and Alexander Williams has been sentenced to five years in prision, after the jury returned unanimous guilty verdicts on two counts of conspiracy to defraud at Southwark Crown Court yesterday.
Kallakis and Williams have also been disqualified from acting as company directors for six years. The case was brought by the Serious Fraud Office following an investigation carried out with the City of London Police.
Between 2003 and 2008 Kallakis and Williams conspired to defraud Allied Irish Banks to obtain loans to finance a mostly commercial property portfolio.
The loans exceeded the purchase price of the properties through guarantees by Hong Kong property company Sun Hung Kai Properties, but the company had no knowledge of the transactions. The loans advanced by AIB were £60m in excess of the cost of the properties.
In a similar fraud in 2007 and 2008,the Bank of Scotland agreed a loan of €29m to convert a former passenger ferry into a super-yacht for Kallakis’s personal use.
He provided the bank with a worthless guarantee from Oregon Finance Corporation, using false accounting documents and forged attribution certificates.
The ferry on which the loan was secured turned out to have no value. By the time suspicions were raised, BoS had advanced €5.7m of the total €29m agreed.
During the trial the jury were told Kallakis used the proceeds of his fraud to fund a super-rich lifestyle in which he maintained a fleet of chauffer driven Bentleys, a private plane, a private helicopter, a luxury yacht moored in Monaco harbour and a collection of high value art works.
SFO case manager Ronan Duff says: “This was an audacious, persistent fraud that enabled these defendants, Kallakis in particular, to lead the lifestyle of the super-rich. The SFO has been equally persistent in investigating this elaborate scam and in ensuring that justice has been delivered.”
Confiscation proceedings will take place at a later date.