Leicestershire council fraud conspirators sentenced

09/05/2014

Two Leicestershire couples have been sentenced for their part in a conspiracy to defraud a local authority. The offences were described by CPS East Midlands Senior Crown Prosecutor Alison Platts as "a complex deception that set out to defraud the public purse".

Malcolm Farnish, his wife Valerie and another couple Stephen and Anna Reynolds stole about £180,000 from Leicestershire County Council through their corrupt dealings in purchasing and supplying specialist highway equipment.

As a stores controller for the highways department, Malcolm Farnish terminated the contract of a supplier of highway equipment and replaced them with a company controlled by his wife Valerie and Stephen and Anna Reynolds. Over the next six years, they charged over-inflated prices for supplies such as highway cutting equipment and pocketed the difference. Their deception was discovered when the number and cost of orders placed by Malcolm Farnish were noticed and investigated within his department. The financial trail led to the other defendants in the case. All four were tried at Leicester Crown Court.

Alison Platts, Senior Crown Prosecutor at CPS East Midlands said:
"This was a complex deception that set out to defraud the public purse. Malcolm Farnish abused his position as an employee of the local authority to change suppliers for specialist highway  and other equipment to a company controlled by his co-defendants, including his wife. Between them, they made financial transactions over a number of years where the taxpayer paid over the odds for essential supplies, while the defendants laundered the proceeds of their dishonesty through a company set up for that specific purpose.

"This conspiracy was far from a victimless crime. The defendants stole six-figure sums from a local authority, funded by the tax payer. They have stolen from all of us. No matter how careful they thought they had been, their transactions left a trail of evidence that led to their conviction and todays sentence. It has been a long and complex process to prepare this case, but todays result shows that criminals of this kind have no place to hide and will face justice."

Malcolm Farnish, Stephen Reynolds and Anna Reynolds were found guilty of three counts of conspiracy to commit fraud by abuse of position, one count of conspiracy to steal and one count of conspiracy to convert criminal property. Valerie Farnish was convicted of one count of conspiracy to commit fraud by abuse of position, one count of conspiracy to steal and one count of conspiracy to convert criminal property.

Malcolm Farnish was sentenced to three years in prison, Stephen Reynolds to two years in prison and Anna Reynolds and Valerie Farnish were handed suspended sentences of 18 and 12 months respectively.

A timetable has been set by the court to recover the funds stolen under the Proceeds of Crime Act 2002.