BUSINESS TYCOON Achilleas Kallakis has admitted he never met anyone from the company he claimed was underwriting the rent on his multi-million pound London property portfolio.
Mr Kallakis (43) and Alex Williams (43) are accused of conning two banks into lending them £750m (€900m) for property deals. AIB lost £56 million (€67 million) when the property empire collapsed in 2008.
Prosecutors allege the pair created a web of forgeries to trick the bank into loaning them the money by claiming their company had £1 billion (€1.2 billion) in property assets. They also claimed multibillion-pound Hong Kong property firm Sun Hung Kai properties had agreed to guarantee the rent on the 16 “AAA buildings”, mostly in London, which they purchased from 2003 to 2008.
Giving evidence yesterday at Southwark Crown Court, Mr Kallakis admitted that he had never met anyone from the company and that all business with them was arranged through a mystery broker, “Richard Lee”, whom his co-accused would meet.
He also said his company did not have a “formal written agreement” with Sun Hung Kai.
He earlier said the property deals were done on behalf of a family trust and he was acting as its chief adviser. He told the court Swiss lawyer Michael Becker was the trustee and would have final say on all investments made by the trust and his children were the beneficiaries.
Mr Kallakis said Sun Hung Kai would agree to underwrite the rent for a fee, which would allow AIB to justify lending the family trust the massive amounts of money, even though it had little equity.
“It was a matter that worried me greatly,” he said. “We were conducting multimillion-pound business deals with this company and I had never met the principals or any of the officers.”
Mr Kallakis told the jury his co- accused would meet the broker in Hong Kong. Notes and agreements were kept of the meetings on a USB stick in Mr Kallakis’s possession.
However, he said, much of the documentation was lost after the USB stick was “misplaced or stolen” a few days after officers from Serious Fraud Office raided his London office in March 2009.
“I lost the USB stick a few days after the raid by the SFO. I was in Monaco at the time of the raid. It came as a massive shock and I was in a total state of panic.”
Both men deny two counts of conspiracy to defraud, 13 counts of forgery, five counts of fraud by false representation, two counts of money-laundering and one count of obtaining a money transfer by deception. The case continues.
