The fine was reduced by almost £20m because the bank agreed to settle. John Cartwright, 72, was a long-time associate of Bancroft who was said to have helped to cover his tracks when shareholders' cash was taken from Ritz.. Cartwright worked as the company's financial director and cooked up false invoices to throw investigators off Bancroft's scent. The board and control functions failed to challenge effectively the pursuit of that course by the executive management, or to ensure adequate mitigating actions. As its name implies, Real Sex is a sexually explicit "magazine" which "explores sex '90s style." “The additional facilities were provided to distressed companies, and involved the use of a workout firm that had a potentially inappropriate link with the member of staff. The QCS 'consultants' - Mills, his wife Alison, 52, Michael Bancroft, 73, and John Cartwright, 72 - ransacked the businesses' accounts by charging exorbitant fees and expenses. That helps us fund This Is Money, and keep it free to use. UPDATE ON HISTORIC FAILURES AT HBOS READING BACKGROUND In January 2017, six people, two of them former employees of HBOS, were convicted and sentenced to up to 12 years in prison for criminal misconduct between 2003 and 2007 through the HBOS Impaired Assets Division, London and South East Region, based in Reading (‘HBOS Reading’). Scourfield got away with his 'deliberate, systematic and sustained' scam for so long because of a 'fundamental flaw' in the banking system, the court heard. Suzie Best, a £250-an-hour escort and former adult TV star described the fat cat banker as a 'short, balding Danny DeVito lookalike' after one session at the rented flat in 2005. Lloyds TSB for example cannot pay out a penny until such time as it has reimbursed the government for its preference shares. “A senior member of staff had been sanctioning limits and additional facilities beyond the scope of his delegated lending authority undetected for at least three years. Mrs Turner added: 'What happened at HBOS Reading was fraud on an industrial scale.'. After their business was destroyed in the scandal, the couple led a tireless campaign to expose the crime – despite repeated denials of wrongdoing by the bank and threats to evict them from their home. It concluded that there was no deliberate attempt to drive the share price down. Later that year he was seen chugging on a large cigar at Mills' 50th birthday bash in Thailand. The result of one of the largest investigations into fraud in the UK has found six people, including two former HBOS bankers, guilty of fraud and money laundering offences. He previously worked as a finance director for investment company Caplay and financial services company Newmarket Investments before it dissolved in September 2016. Explore our AccountingWEB Live Shows and Episodes, View our 2020 Accounting Excellence Firm Awards Finalists, Free accounting software offer with Ulster Bank NI, Bounce Back Loan Scheme corrupted by fraud, Five ways Open Banking will benefit your firm, Gold dealer’s poor records lead to high tax demand. [37] Following the convictions, the background to the case was reported on BBC Radio Four's File on Four programme on 31 January 2017. The Managing Director of Credit Risk Hugh McMillan should have been alerted to the biggest deals. His favourite escort Suzie also offers 'verbal and physical domination' for clients who like spanking and humiliation. Real Sex is a documentary television series broadcast on and a production of HBO. Scourfield, who earned £88,600 a year, was also given free rein to travel across the world and splash out with an Amex card at Mills' expense. My wife and I decided to sell our HBOS shares. In 2004 David Mills wrote in support of Scourfield's mortgage application to the Portman Building Society, telling them he was due to receive a bonus of up to £100,000 from QCS. […] Mills and his associates used the bank's customers and the bank's money dishonestly to enrich themselves." Once they agreed, Scourfield authorised more than £500million of loans to the high-risk clients from his HBOS office in Reading, regardless of their ability to repay. By profiting from bribes and high consultancy fees, these bank managers and consultancy staff were able to treat themselves to expensive jewelry and luxury holidays – all while many affected businesses had no option but to go bankrupt. Found guilty of one count of conspiracy to corrupt and one of conspiracy to conceal criminal property. A recent report discovered that senior executives at HBOS knew about the fraud as far back as 2008, yet only ever attempted to cover it up. The crooks then systematically bled the company dry, eventually taking it away from Miss Dove amid threats as while she was expecting her fourth child. Andrew Reade, who was left £250,000 out of pocket after his company Keenets was pillaged by Quayside, wrote to Victor Blank, the then chairman of Lloyds TSB, at the time of its takeover of HBOS in 2008 outlining in extensive detail the scale of the consultancy's 'huge fraud'. Bancroft splashed £100,000 on a failing businesses' credit card during the con and clawed in at least £200,000 of unauthorised payments. Will the UK election result boost or sink the stock market? Amid the chaos, Lloyds instructed Deloitte to investigate Scourfield's activity after the Financial Services Authority (now the Financial Conduct Authority) issued a requirement notice. The fraud carried on unhampered for four years because of a 'fundamental flaw' in the bank's checking system. Find out what you need to know. They might be giants: Do US smaller companies still offer rich pickings? Several members of Quayside's staff had criminal records for embezzlement. We do not write articles to promote products. Our family was devastated... they robbed me of my life's work.'. How to invest to beat inflation: A global fund manager's tips, MIDAS SHARE TIPS: Canada-based gold miner Yamana hits a rich seam of dividends. It is estimated that the figure required to cover all the losses from businesses could reach as high as £1bn – a far cry from £100m. David Mills was found guilty of one count of conspiracy to corrupt, four counts of fraudulent trading and one count of conspiracy to conceal criminal property. Cars that sip fuel and the gas guzzlers that empty bank accounts: Real world test reveals which models are most frugal, Car production hit lowest September level since 1995 as industry bosses make desperate plea for Brexit deal, Only ONE PER CENT of Department for Transport vehicles are electric and majority of its fleet are diesel, despite government push for greener cars, New £250,000 Ghost 'most technically advanced' Rolls-Royce ever, Volkswagen reveal the first electric SUV ID 3 and 4 range, Blue Whale manager: Facebook is good value but not Tesla, Maserati's back! He told police: 'My business expertise is in textiles. They also owned a 100ft £2million luxury superyacht called Powder Monkey, which was moored in the Mediterranean. Scourfield pleaded guilty at an earlier trial last year. Six people, including two former HBOS bankers, were found guilty of bribery and fraud. I lost everything, my reputation, all our money, all our pension schemes. When the wealthy gang of four men and a woman were convicted for the five-year fraud on Monday, Thames Valley Police commissioner Anthony Stansfeld described it as a 'shocking' and 'disturbing' crime. He was cleared of any involvement by the jury today. He is best known for his appearances in Halifax/HBOS television advertisements, often singing and dancing. The views expressed in the contents above are those of our users and do not necessarily reflect the views of MailOnline. Bancroft even locked her in a room as he demanded controlling shares in the company. What next for Neil Woodford and his investors? The QCS gang spent the profits on millions or pounds' worth of property across Europe, birthday bashes in Thailand and Barbados, trips to Ascot, and a yacht. [37] The court also convicted David Mills, Michael Bancroft, Alison Mills, and John Cartwright for their parts in the conspiracy. HBOS plc was a banking and insurance company in the United Kingdom, a wholly owned subsidiary of the Lloyds Banking Group, having been taken over in January 2009. On 13 February 2009, Lloyds Banking Group revealed losses of £10bn at HBOS, £1.6bn higher than Lloyds had anticipated in November because of deterioration in the housing market and weakening company profits. My children lost their father in their lives and the idyllic childhood they previously had. Scourfield, who boasted of being the 'grand wizard', enjoyed luxury holidays, trips on Mills' superyacht and sex with porn stars in return for his help. [1] The formation of HBOS was heralded as creating a fifth force in British banking as it created a company of comparable size and stature to the established Big Four UK retail banks. The investigation, which took Thames Valley six years to undertake, started after allegations of fraud were unearthed. The deal was concluded on 19 January 2009. It's now up to HBOS to come to the table.'. Cohen, the co-founder of Brett Adams, became 'hopelessly compromised' as he relied on Mills' businesses for his turnover and took a £151,000 loan from one of his firms in 2006. In total, with additional payments, this amounted to £2,606. Lloyds is seeking to drum-up £5.5bn of new funds as part of the deal. The preference shares were subsequently subject to an exchange offer in December 2009. The Quayside consultants also enjoyed a luxury life from the money they stole. [41] Dame Linda Dobbs is chairing an independent inquiry into the investigation and reporting of the fraud.[41]. A later entry read: 'Chinese meal. But with shares closing at 150p on Friday December 5, it seems that it will be likely that the government, which is underwriting it, will be mopping up the lion's share of the offer. Mr Crosby, thought to draw more than £400,000 a year from his HBOS pension, said he was 'deeply sorry' for the disaster. [27], In December 2008, the British anti-poverty charity, War on Want, released a report documenting the extent to which HBOS and other UK commercial banks invested in, provided banking services for, and made loans to arms companies. He failed to disclose £150,000 of income to HMRC while working for the textile firm. With the Lloyds deal approved, someone with 333 HBOS shares will end up with 201 Lloyds shares. Although officially HBOS was not an acronym of any specific words, it is widely presumed to stand for Halifax Bank of Scotland.
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