UK property tycoon found guilty of bank fraud

Kirstin Ridley
16 January 2013

LONDON, Jan 16 (Reuters) - Two businessmen have been found

guilty in London of defrauding banks of hundreds of millions of

pounds to fund a lavish lifestyle and build a commercial

property empire, in their second conviction for deception and

forgery in 18 years.

London-based Achilleas Kallakis and Alexander Williams, both

aged 44, persuaded Allied Irish Banks to lend them 740

million pounds ($1.2 billion) by using forged documents and fake

property guarantees between 2003 and 2008, the Serious Fraud

Office (SFO) said on Wednesday.

The loans enabled Kallakis to build a 16-property portfolio.

The fraud, which included an agreement from HBOS, now part

of Lloyds, included a multi-million euro loan Kallakis

said was to convert a passenger ferry into a super-yacht. Around

six million euros of that loan was advanced.

A third person, Swiss lawyer Michael Becker, was director of

companies involved in the loan agreements and was closely

involved in the fraud, the SFO said in a statement. He was not

charged as he lives abroad and is outside the SFO's


The jury, which returned unanimous verdicts on two counts of

conspiracy to defraud, were told Kallakis maintained a fleet of

chauffeur driven Bentleys, a private jet, a private helicopter,

a luxury yacht moored in Monaco and high value art.

Kallakis and Williams, an expert forger, have been remanded

in custody awaiting sentencing on Thursday.

The two men, who changed their names after being convicted

in 1995 of selling bogus honorary titles mainly to Americans,

operated out of an office in London's plush Mayfair district as

the Pacific Group of Companies.

They pretended a respected Hong Kong company, Sun Hung Kai

Properties (SHKP), was guaranteeing long-term, top

rents for commercial properties. This inflated the price of the

properties to 60 million pounds above their cost, the SFO said.

They also provided false guarantees from a company called

Oregon Finance Corp, which Kallakis said was a billion-dollar

ship-owner belonging to his family trust. Oregon Finance,

however, had millions of pounds of liabilities and no assets.

During 2007 and 2008, Kallakis agreed a 29 million euro HBOS

loan for the boat conversion. He provided the bank with

documents that included a death certificate of his mother in

which her surname was altered to hide Kallakis's name change.

But by August 2008, AIB discovered that Kallakis had a

previous fraud conviction in the name of Stefanos Kollakis. They

contacted Hong Kong's SHKP, which confirmed they had not offered

Kallakis any rent guarantees.

A police investigation began in January 2009 and the men

were charged in February 2010.

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