West Yorkshire-based pension fraudsters jailed over £3.7m scam

Two men who tricked dozens of vulnerable people into investing £3.7m into a bogus “pension liberation” scheme have been jailed.

Daniel Giles and Mohammed Bashforth conned 74 victims by claiming they offered a tax-free method of accessing their pension pots early.

Along with a third man, Kevin Phelan, at one stage the fraudsters tired to use the “smokescreen” of attempting to buy Doncaster Rovers football club in order to explain away unusual payments while being investigated, Leeds Crown Court heard.

Giles, 51, and Bashforth, 63, were both found guilty of conspiracy to cheat the public revenue and conspiracy to commit fraud by false representation and sentenced to 11 years and five years respectively.

Phelan, 62, from Omagh, in Northern Ireland, who was convicted of the same offences, will be sentenced at a later date.

The court heard the trio took advantage of people already in financial difficulty – such as needing to pay care home fees, going through a divorce or in mortgage arrears – and convinced them to invest their savings in the scam.

Referring to one investor, Giles, of Jacob Drive, in Coventry, said the man “doesn’t even know what day of the week it is”.

The offences took place between 2013 and 2015, with the men directing their operation from offices in Wakefield and Leeds.

Prosecutor Tim Hannam KC described them as “mature, intelligent and experienced” in the financial world and said they used their expertise to set up the operation, which was fraudulent “from the outset”.

The court heard how they provided “misleading brochures, data sheets and marketing materials” to providers and investors.

But, he said “when the claims weren’t received positively, bullying and intimidating tactics were deployed in the form of threats to bring false claims for defamation”.

The trio also deliberately hid the fact that early access to pensions in this way was subject to tax of up to 55%.

Judge Penelope Belcher said the scheme had been solely designed to “make money for themselves”.

She read out a number of “distasteful and money-grabbing” texts sent between the men, including one boasting they would have “oodles of noodles” [money] by Christmas and another saying they needed to “ramp up” their scheme.

The court heard the men had set up “many companies” in the names of “nominal directors who had no idea their identities were being used in that way”.

Mr Hannam said payments to their accounts were concealed by “sequences of transactions in which payments were transferred to several accounts with misleading bank references”.

He said that after they came under investigation from police and the National Crime Agency (NCA), the defendants even “tried to hide behind an attempt to buy Doncaster Rovers” to explain the payments.

In total, between 17 December 2013 and 8 December 2014, 74 victims were persuaded to transfer their pensions, in full or in part, into bank accounts controlled by the Giles, Phelan and Bashforth.

The total amount transferred was £3,701,813.92 and they also defrauded HM Revenue and Customs out of £700,000 in tax owed, said police.

Giles also pleaded guilty to a further charge of cheating the public revenue after the court heard he had not filed a tax return for six financial years between 2008 and 2014.

A total of £834,509.75 owed by Giles – a figure which excludes interest – remains outstanding the court heard.

Sentencing him, Judge Belcher said that while a letter he had written to her was “eloquent” he had failed to address the effect his offences had on his victims.

“The impact was enormous, shock and distress and a great deal of anxiety – they were already struggling by way of wanting to release their pensions.”

Giles was sentenced to 11 years and disqualified from being a company director for 12 years.

Judge Belcher said that while Bashforth, of Spen Lane, Gomersal, was not the ringleader, he “allowed himself to be used”.

He was sentenced to five years and disqualified from being a company director for eight years.

Speaking after the sentencing, Ramona Senior, head of the Yorkshire and Humber Regional Organised Crime Unit said: “This was a complex and protracted investigation, but I am pleased that the jury were able to see that the intentions of those convicted were dishonest.”

She added: “Driven by greed, they sought access to pension holders’ cash and treated the funds they obtained as pots of money which they dipped into at will, with no intention to properly invest the funds or highlight the tax liabilities created.”