Bogus Yorkshire investment scheme gang stole £5m from victims

A GANG of fraudsters from Yorkshire stole more than £5 million from victims who they conned into putting money into bogus investment schemes.

Friday, 11th November 2016, 11:23 am
Updated Wednesday, 16th November 2016, 3:30 pm
From left, Keith Wharton, Lee Wharton and Stephen Pickard .

Keith Wharton and his son Lee used much of the money to live the high life, spending vast amounts on yachts and luxury cars while investors lost life savings, pensions and ended up living in poverty.

Wharton, 60, was the ringleader in a series of frauds which took place over an eight year period.

Jailing the gang to a total of 34 years, a judge told the Whartons: “You cheated people out of their money which was hard earned.

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“You have left behind a trail of personal and financial ruin while you sunned yourselves on your yachts in Spain or drove Aston Martins, Lamborghinis or Maseratis.”

In one scam Keith Wharton managed to convince people to put money in a land scheme based in Panama after claiming to be a commercial property ‘guru’ and a billionaire.

He arranged for potential investors to fly out to the central American country for a seminar entitled ‘Secrets of the Super Rich’.

Wharton, who was close to bankruptcy when he carried out the offences, told those who invested their money in land through a syndicate that they could double their money within 12 months.

Prosecutor Andrew Haslam told Leeds Crown Court that there were over 30 investors in the Panama land fraud and they invested a total of £2.8m.

He added: “None of them received any return on their investment.

“Indeed, nobody even received their investment back. None of it went to buy land in Panama. Instead, Keith and Lee Wharton used it to fund their lavish lifestyles.”

The court heard one victim, a piano teacher from London, invested £230,000 in the scheme and now lives in poverty after losing all the money.

Wharton was helped in the deception by Leeds-based solicitor Stephen Pickard, who “put up a barrier” to stop investors getting their money back.

The court heard Pickard - described by the sentencing judge as Wharton’s ‘right hand man’ - threatened victims with legal action if they continued to try to contact Wharton to get their money back.

Wharton also led other frauds with help of financial adviser Simon Kippax.

Kippax introduced retired businessman Michael Massingberd to Wharton in 2009 with the promise that he would be offered 100 per protection on an investment that would guarantee him a 300 per cent return in just 12 weeks.

Mr Massingberd formed the Massingberd Motor Group PLC in 1963. By the time he retired and sold the business in 2005, it included four VW dealerships and one Audi dealership in North Yorkshire.

The court heard Mr Massingberd also knew Pickard well as he worked for Lupton Fawcett, a well-regarded local firm of solicitors.

Mr Haslam said: “Mr Massingberd had faith in Kippax and Pickard because of what he knew about them.

Pickard convinced Mr Massingberd that he had known Wharton since he was a child and told him he was a nuclear physicist.

Mr Massingberd lost £1.1m on his investment in the scheme.

In another offence Wharton duped victim Gary Gordon to invest in a scheme after convincing him he had worked for Merrill Lynch, the major wealth management firm based in New York

Mr Haslam described one meeting between Wharton and Mr Gordon which took place in Majorca. He said: “He explained how he had grown up as a working class boy in Leeds.

“He worked his way up in life to an 80 bedroomed mansion on a hill in Majorca on which Peter Stringfellow also lived.

“He said he had 12 yachts. He told Mr Gordon that he paid his wife £20,000 each month to buy the finer things in life.”

He added: “When Mr Gordon returned to the UK, he met up with Pickard to discuss the property deal.

“Nothing ever came of it. Mr Gordon was fobbed off with excuse after excuse just like others before and after him.

Mr Gordon’s money was paid into an account controlled by Wharton’s son.

Wharton also headed other illegal investment schemes in which investors lost sums totalling £1.7m and £563,000.

Keith Wharton, of Park House Apartments, Leeds, was jailed for 12 years after pleading guilty to five offences of fraud by false representation.

The three other defendants were found guilty of offences after a trial which lasted five months.

Lee Wharton, 34, also of Park House Apartments, was jailed for seven years after being found guilty of concealing criminal property.

Pickard, 66, of Belgrave Road, Harrogate, was jailed for eight years after being found guilty of two offences of fraud by false representation and concealing criminal property.

Kippax, 52, of Moorcock Lane, Darley, Harrogate, was jailed for seven years after pleading guilty to fraud by false representation and making a false statement

Judge Guy Kearl, QC, said many of the victims had been left in poverty as a result of the offending. Others had been left suffering from anxiety and depression and it had caused relationships to break down.

The judge told Keith Wharton: “You are the central figure in what was a sophisticated series of frauds calculated to dishonestly separate people from their money over an extended period of time between 2005 and 2013.

“You did this by creating a subterfuge of false investments based on groundless promises and bare face lies.

“They were started at a time when you were near bankruptcy proceedings.”

The judge told Pickard he had abused his position as a lawyer to give a “veneer of respectability” to the frauds. He said he had also dragged the good name of his former employer “through the mire”.

After the case, Richard Marshall, Lupton Fawcett’s managing director, said aidmented: “We are dismayed that Pickard misused and abused the good name of our firm; he did so without our knowledge or authority.

“Once we became aware of the seriousness of the misuse we made our regulators aware of Pickard’s unauthorised action’s and he departed the firm shortly thereafter.

“At no point was our firm in any way involved in Pickard’s offence.

“I and my fellow Directors are appalled at Pickard’s conduct and very much regret his former association with our firm and the damage done to those affected by his criminal activities.”

DI Jon Hodgeon, Head of Fraud and Economic Crime for North Yorkshire Police, said: “These calculated, callous and arrogant men spent years defrauding innocent victims of millions of pounds. Fraudsters like the Whartons, Pickard and Kippax are greedy criminals who masquerade as businessmen, and they are now where they belong - behind bars.

“This should serve as a stern warning to anyone out there who thinks they can get away with fraud. You can’t.

“We are watching you and we will find you and put you before the courts.”