Ex-Dunlop Haywards valuer jailed for £49m mortgage fraud
FORMER Dunlop Haywards valuer Ian McGarry has been sentenced to seven years for his part in a £49m mortgage fraud.
Speaking at Southwark Crown Court yesterday, Judge Beddoe said he could find “no explanation” for McGarry’s role in the crime but “simple and frankly, rampant greed.”
He said to McGarry: “You were seduced by a culture of dishonesty because you, as a person, were fundamentally prone to be dishonest.”
McGarry blamed a culture at Dunlop Haywards and his other former employers of giving ’optimistic’ valuations of properties, while ignoring many downsides.
His defence said this method of valuation had grown in parallel with the property industry during the boom years.
McGarry also placed blame on the banks for failing to carry out proper due dilligence, to which Judge Beddoe replied: “If a homeowner leaves his door open, it does not make it right for anybody to go inside and steal the goods”.
Police were first called in by Macclesfield-based Cheshire Building Society and the matter was soon passed to the Serioys Fraud Office. Cheshire was not the only lender affected.
McGarry was sentenced alongside Saghir Afzal, one of two brothers accused of instigating the fraud. Afzal received a prison sentence of 13 years and disqualified from being a company director for 14 years.
He claimed his brother, Nisar, was the ringleader and told the court he had simply been ’used and abused’.
But Judge Beddoe said: “It seems to me that the two of you were in a close partnership where one cannot operate without the other.”
The fraud relates to bribes given by the Afzal brothers to Ian McGarry to provide fraudulent valuations of six properties.
The valuations were up to 19 times the true value of the property.
The Afzals used McGarry’s valuations to secure around £50m in loans from banks, £26m of which has been sent to Pakistan, where the Afzals have considerable numbers of business associates and family members.
The Afzals used “shell companies” under their control to sell properties back on forth in order to inflate their value.
The brothers also arranged for solicitors to create fake leases and forwarded loan applications through reputable mortgage brokers to inflate the properties’ value further.
The court heard that McGarry met Nisar Afzal on multiple occasions in a Starbucks in the City, where Afzal provided him with undisclosed sums of cash.
It is thought McGarry gained in excess of £1.2m through the fraudulent transactions alongside as yet unknown amounts in cash bribes.
McGarry was arrested on 15 March 2006 for his part in a suspicious transaction relating to a shed in Ascot, near Birmingham.
He was released, but arrested a second time outside the Vault in the City, carrying £86,000 in cash.
Police conducted a search of the toilets in the building and found a bent United National Bank card in his name hidden behind a panel with a rewritable CD Rom.
Six solicitors connected to the case have been acquitted in recent weeks, but Judge Beddoe said “a lot is still unsaid” in relation to the complicity of other professionals.
