A chartered accountant has been convicted of three counts of fraudulent trading in a £3.25m fraud scandal.

Jeremy Greene, a director of collapsed second hand computer parts supplier Ravelle was found guilty of playing a key part in an invoicing fraud by a judge at Manchester Crown Court.

The fraud centred around the creation of false sales documents and a complex web of inter company transactions which hoodwinked IBM Global Financing and Barclays Sales Finance into bankrolling Ravelle, using fictitious orders as collateral.

The case was referred to the SFO by Greater Manchester Police after Ravelle's receivers raised serious concerns in 2001.

'The SFO said: 'Throughout the fraud Greene performed a finance and management function for the Ravelle group. He was the individual who had a sufficient financial overview to enable the complicated transactions required to keep the fraudulent schemes running.'

According to the SFO, the company used 'fresh air' invoicing which involved fabricating IOUs and pretending these represented real orders.

The company also used 'circular trading' which allowed 'a continuing systematic deception of the factoring company,' the SFO said.

The circular trading involved Ravelle pretending it had an order from outside businesses, which were termed as 'friendly' companies. These were Tracktek Industries Limited, Mad Mac Limited and Cheap Internet Access Limited.

The factoring company was informed of the order and lent money against the invoice. In due course the factoring company expected the 'friendly' company to pay for the goods it ordered so the loan could be repaid.

If the transactions had been genuine, the funds to repay the loan would have to come from the relevant 'friendly' company, but Ravelle set up an intricate system which tricked the creditors into believing that the money had come from the outside businesses.

IBM Global Financing lost £1,600,000 whilst Barclays Sales Finance lost £654,857. Other creditors lost approximately £1,000,000.