Last week, after months of behind-the-scenes inquiries, 70 personnel from the Serious Fraud Office and 40 police officers swooped on 19 addresses across the country as part of a multi-million-pound property fraud investigation.
Search warrants were executed at commercial and residential addresses in
On Thursday 3 December, multi-millionaire entrepreneur Edward Davenport, 43, and two others appeared at the City of
The offences include an alleged advance fee fraud and price-ramping allegations.
An office building at
The valuation of the building is alleged to have been inflated by a fraudulent claim that a company, Paul Street Media Ltd, had a 15-year, £186,500 pa lease with the rent guaranteed by Gresham Ltd.
There is no implication that Allsop is involved in the investigation.
Within hours of appearing in court,
Businessman Martin Peter Riley, 62, was also charged and remanded in custody to the south
Of the trio who were charged with conspiracy to defraud, deception and money laundering offences, only solicitor David Martin Layard Horsfall, 54, was granted bail and allowed to return to his
The alleged fraud involves numerous companies, which according to SFO spokeswoman Jina Roe were often given names that very closely resembled well-known and respected businesses as part of a strategy to mislead applicants.
These include Gresham Ltd and Gresham Finance (
The alleged advance fee fraud is said to involve the playboy businessman and his partners conning wealthy and well-known figures by offering loans of up to £250m.
Applicants for the loans – advertised in newspapers, magazines and on the internet – were charged between £5,000 and £50,000 for a due-diligence check and were then required to make a security deposit of 1-5% of the loan amount.
But despite paying the required deposits, the prospective clients were alleged in court never to have received the money.
No names of the alleged victims were given in court but the SFO said that most applications for loans came from resort and hotel developers from
The SFO has since confirmed that its enquiries are being extended to cover allegations of rent fraud. In a statement, it said: “This involved Gresham Ltd leasing a building for several years, obtaining a rent-free period in the process.
“They then sublet the premises and failed to pay rent as agreed to the owner.”
The trio charged last week will appear at Southwark Crown Court on 2 February, when they will submit their pleas.
A further three people who were arrested were released without charge. One of them was bailed until 12 January 2010.
* Property fraud cases set to rise
The amount of property fraud being uncovered is expected to rise in the coming years because of the continuing lack of liquidity in the market.
In March this year, the National Lead Police Force for Fraud said that it was already involved in 71 cases of property fraud, amounting to some £1bn.
The attorney general launched a three-year national fraud strategy in the spring.
A review into the full impact of mortage fraud will be released in 2010.
**Gatecrasher Balls and star parties
Edward Davenport made his name at the age of 16 as organiser of the legendary Gatecrasher Balls before graduating to holding star-studded parties at his
A 1,000-word biography on his website mentions his £100m property portfolio and details his “high life in
It goes on to list his material assets including “a jet, beautiful homes and a collection of sports cars which would make any man jealous”.
It acknowledges that he takes risks, but says that “every risk Edward Davenport ever takes is calculated right down to the most tiny detail: he does not gamble when he cannot win” and adds that he “goes to extremes to ensure he is scrupulously fair in all his dealings”.
