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Trio sentenced for £4.6M mortgage fraud

09/08/2010

Three people were sentenced today to almost ten years imprisonment in total for defrauding mortgage providers of £4.6 million in a fraud that Crown Prosecution Service lawyer Stephen Rowland described as remarkable for its "sheer scale and effectiveness".

Charles Overend, a former police financial investigator, defrauded mortgage providers by hiding discounts he had received on the price of residential properties, tricking the lenders into providing loans that were proportionally much larger than normal for buy-to-rent houses. He was assisted by Carrol Thompson and Jonathan Overend, his brother.

Stephen Rowland, reviewing lawyer for the CPS Central Fraud Group, said: "The sheer scale and effectiveness of this fraud were remarkable. Charles Overend and his associates bought 32 properties across the country between them, using £4.6m obtained dishonestly through mortgages. Lenders were eager to make the most of the property boom and Mr Overend knew how to exploit them to turn himself into a property millionaire.

"This trio did not have the cash to get heavily involved in property, so they decided deception was the answer. Today's sentences have proved them wrong."

Charles Overend received a sentence of five years and six months for the mortgage fraud, plus a consecutive three month sentence for possessing a false identity document. His brother, Jonathan, was sentenced to one year of imprisonment. Carrol Thompson was given a suspended sentence of 150 weeks and 200 hours of unpaid labour.

Mr Rowland explained that the scam relied on Charles Overend securing a substantial discount on the asking price of properties - one example was a discount of £89,900 in total on two properties in Wigan. He then applied for mortgages for the asking price instead of the price actually agreed. Carrol Thompson, who was employed as a clerk for various solicitors' firms as the fraud went on, assisted Mr Overend by supplying false information to lenders or their agents on the agreed price for the properties.

Mortgages for buy-to-let properties were readily available at the time as lenders anticipated the interest due would be paid by the rent, but they would only loan up to 85% of the property's value for its purchase. The undisclosed discounts allowed the defendants to secure loans worth more than 85% of the value of each property. A mortgage for properties in Harrogate was actually worth 107% of the agreed purchase price.

All three defendants pleaded guilty on 7 July 2010 at Southwark Crown Court. Their trial was scheduled to begin on 12 July.

Charles Overend pleaded guilty to six counts of obtaining a money transfer by deception (the mortgage) in relation to the purchase of properties in:

  • Hadleigh, Essex
  • Ossett, Yorkshire
  • Standish, Wigan
  • Chertsey, Surrey
  • Mayfair Court, Wakefield
  • Regent House, Harrogate

Carrol Thompson admitted three counts of conspiracy to defraud in relation to the purchase of properties in:

  • Regent House, Harrogate
  • St Andrews Road, Lytham St Annes
  • Whipcord Lane, Chester

Jonathan Overend pleaded guilty to one count of obtaining a money transfer by deception for properties in Regent House, Harrogate.

Charles Overend also pleaded guilty on 24 March 2010 to possession of a false identity document, which was found when he was arrested and his home searched on 11 March 2008. The document was a provisional driving licence in the name of Howard David Thompson, born on 12 April 1972, with Charles Overend's photo (he had certified the photo in his own name in his position as a police officer). The real Howard Thompson had died as an infant on 6 July 1973.

Ends

  1. Media enquiries by phone: 020 3357 0906. Out of hours pager: 07699 781926.
  2. Obtaining a money transfer by deception is an offence under section 15a of the Theft Act 1968 and punishable by up to 10 years imprisonment.
  3. Conspiracy to defraud is a common law offence but the maximum sentence was set at 10 years under section 12 of the Criminal Justice Act 1987.
  4. Possession of a false identity document (without intent) is an offence under section 25(5) of the Identity Cards Act 2006. It is punishable on indictment by up to two years imprisonment and a fine.
  5. The Crown Prosecution Service is the independent authority responsible for prosecuting criminal cases investigated by the police in England and Wales. It is responsible for:
    • Advising the police and reviewing the evidence on cases for possible prosecution
    • Deciding the charge where the decision is to prosecute
    • Preparing cases for court
    • Presenting cases at court
  6. The CPS consists of 42 Areas in total, each headed by a Chief Crown Prosecutor (CCP). These are organised into 14 Groups, plus CPS London, each overseen by Group Chair, a senior CCP. In addition there are four specialised national divisions: the Central Fraud Group, Counter-Terrorism, Organised Crime and Special Crime. A telephone service, CPS Direct, provides out-of-hours advice and decisions to police officers across England and Wales.

    More about the CPS