A PAIR of suspected fraudsters conned Allied Irish Bank into lending them £740 million (€850 million) by using fake guarantees from a massive Hong Kong property firm, it was claimed yesterday.
Achilleas Kallakis and Alexander Williams falsely claimed that Chinese property giant Sun Hung Kai Properties (SHKP) was willing to act as guarantor and forged documents that were then stamped by unwitting solicitors.
The pair used an Asian accomplice to get a solicitor to notify that they had witnessed the signing of guarantees, Southwark Crown Court heard.
This was to avoid raising suspicions about why someone European-looking was signing with an Asian name. The Asian who signed the documents has never been identified. The pair also used an Asian acquaintance, Jonathan Lee, to pose as a senior SHKP representative when AIB grew suspicious and he met with bank officials reassuring them with his knowledge of the deals.
Mr Kallakis and Mr Williams created a smokescreen which appeared to show that the rent on the properties was guaranteed so that even if tenants went out of business and failed to pay AIB’s loans were covered.
These fake guarantees even increased the value of the properties that Kallakis and Williams purchased, meaning that they were loaned almost £100 million more than they paid for them.
One such guarantee saw AIB loan the pair £18.8 million pounds to buy an office block in London’s Euston Road. However, the pair only paid £15.9 million for the building, giving them a surplus of £2.8 million. Much of the surplus cash was alleged to have financed a lavish lifestyle, including use of helicopters, private jets and a villa on the Greek island Mykonos for Mr Kallakis.
Asked for another guarantor, they presented AIB with Oregon Finance Corporation, a company they falsely claimed was a shipping and property company with billions of pounds worth of assets.
The sophisticated scam saw a special company set up to purchase the property, which then sub-let it to another company, which was falsely claimed to be a subsidiary of SHKP. Documents were forged to confirm the link with the Hong Kong company, it was claimed.
Things began to unravel in summer 2008, when AIB wrote to SHKP asking them to confirm the leases and guarantees the pair had given them. Having realised that they had been conned, AIB arranged meetings with the pair, during which they denied any wrongdoing.
Prosecuting, Victor Temple QC dismissed Mr Kallakis’s attempts to distance himself from the fraud saying: “False documentation suggests that Becker was the man behind these transactions.
“Kallakis from first to last was in the driving seat. He was nobody’s agent. Others were the agents of him.”
Discussing their reaction to the discovery of the alleged fraud, he added: “Kallakis stated that he had believed that the SHKP guarantees were genuine and both he and Becker professed astonishment that they were not.
He added: “The financial standing of Oregon was discussed. Kallakis claimed that Oregon was worth between $2.5 and $3 billion.
“When pressed as to the financial support that could be forthcoming from Oregon, he prevaricated, saying that Oregon’s funds had been used elsewhere and that he was not the sole decision maker behind Oregon.”
The trial continues on Wednesday.
