Edward Davenport (fraudster) - Advance Fee Fraud

Advance Fee Fraud

In late 2005 Davenport acquired an existing shelf company and renamed it as Gresham Ltd – the name is similar to, but wholly unconnected with, the well-known wealth management company Gresham Financial – which he used as a vehicle for advance fee frauds. Gresham was falsely presented as a long-established, wealthy and prestigious firm with a prospectus claiming that it had been involved in the commercial loans market since 1958. The company promoted itself through glossy brochures and advertisements in the Financial Times.

Between 2005 and 2009, Davenport and several co-conspirators promised to finance over fifty commercial loans, targeting construction projects in several countries. Businesses were asked to pay large sums for "deposits", "verification fees", "loan guarantees" and "due diligence". The company's records noted payments of £4.5 million from prospective borrowers. Ten of the largest prospects were promised loans of £500 million but, like the rest, received nothing. In one case reported by the Financial Times, a fee of €830,000 was charged as a "security deposit". The value of the fraud was said by prosecutors to be at least £12 million. Victims included Elizabeth Emanuel, who lost her savings after being promised a £1 million loan. An Indian businessman paid £285,000 to finance a €183 million loan but suffered "crippling losses" of £825,000 after no money arrived, leaving him owing €11 million.

In October 2009 Gresham was liquidated after companies secretly controlled by Davenport petitioned to have it wound up. He carried on the advance fee fraud through another newly acquired shelf company, Cutting and Company (Investments) Ltd, which had been established in 1930 and had been dormant since about 2000. Cutting & Co. was portrayed to the public as a restructuring expert. Davenport sought to keep his distance from the fraud by using aliases such as "James Stewart" or "James Stuart". However, he was exposed when fire regulators recognised "James Stewart" as Davenport from photographs on his own website and informed the Serious Fraud Office (SFO).

Two months later, at the start of December 2009, SFO investigators and police raided 19 commercial and residential properties in London, Surrey, Cheshire and Derbyshire and arrested six people. Davenport was charged with conspiracy to obtain money by deception, conspiracy to commit fraud by false representation and money laundering. He was also accused of carrying out a "price ramping" fraud on a £2.4 million property in central London to artificially increase its price at auction. The property, an office building at 80 Paul Street in the City of London, was said to have been sold for £700,000 more than its market value due to a false claim made about a lease supposedly guaranteed by Gresham Ltd. The SFO also said that it was investigating allegations of a rent fraud involving Gresham.

Also accused were David McHugh, an accountant; David Horsfall, Davenport's solicitor, Peter Riley, a Gresham director; Richard Kirkup (also known as Richard Stephens), who had been convicted in 2004 of a previous advance fee fraud; and Borge Andersen, a Danish national who worked as Gresham's senior loans officer. Davenport and Riley were remanded in custody to Wandsworth Prison while the others were released either on bail or without charges.