Fraudsters jailed over multimillion-pound mortgage con

http://www.bbc.co.uk/news/uk-england-tees-34549500

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A group of fraudsters who conned banks in a huge property swindle have been jailed.

The operation was on a "truly massive scale" with lenders ultimately losing £112m, Teesside Crown Court heard.

They were part of North East Property Buyers and Newcastle Home Loans, which bought up thousands of homes but lied on its mortgage applications.

They defrauded banks by making false claims when borrowing money to build their property empire.

The firms paid knockdown prices to buy homes from people struggling with their mortgages and offered to rent them back.

The court heard lenders, including Mortgage Express and Southern Pacific Mortgage Lenders, forwarded almost £300m until the company collapsed.

A "substantial number" of the conspirators' mortgage applications were fraudulent, the court heard.

David Purdie, 57, of Dunston, Gateshead, was described as the man behind North East Property Buyers.

He admitted conspiracy to defraud along with Michael Foster, 43, of Houghton, who was a director of Newcastle Home Loans, and underwriter Linda Patterson, 57, of Newcastle.

Chartered surveyor Steven Keay, 54, of Ryhope, Sunderland, admitted furnishing false information.

Purdie lived in a lavishly decorated home at Darras Hall in Northumberland and presented himself as a man of wealth, the court was told.

Foster, a former professional cricketer with Durham, Yorkshire and Northamptonshire, was described as Purdie's "right-hand man".

Barristers for the accused said they had started out with honest intent thinking they would enrich themselves in the property market but "took a risk that didn't pay off".

The scheme was doomed as the financial crisis of 2008 approached and they were unable to finance the mortgage repayments, the court heard.

As well as the money taken from the banks, prosecutor Jane Bewsey QC said they had drawn in investors, many of whom now faced financial ruin.

Judge Howard Crowson said much of the money obtained from the banks was lost and did not amount to personal gain for the defendants.

He jailed Purdie for five-and-a-half years, Foster for three years-and-nine months, Patterson for three years-and-two months, and Keay for 23 months.

A fifth defendant, accountant Peter Wardle, has now been convicted of furnishing false information and will be sentenced on 30 November.