Accountant's fraud victims receive money boost

Victims ripped off to the tune of almost £1m by a crooked north London accountant have had their hopes of getting their money back boosted by a top judge.

Evdokimous Christou was a highly respected partner in Finchley-based accountancy firm, Foster Squires, until a trail of fraud and deceit was uncovered in February 2006.

It was then that he "went missing" and amongst the "vulnerable" victims he left behind was his own personal assistant, Beverley Goldberg, who entrusted him with £70,000 from a divorce settlement, said High Court judge, Mr Justice Tugendhat, today.

Hard-pressed sandwich bar owner, Frank Zanelli, and his wife, lost over £500,000, and succesful car dealer, Costa Nicolaou and his firm, Enfield-based RS Motor Sales Ltd, over £200,000.

And their losses may only be the tip of the iceberg after Mr Justice Tugendhat today revealed that "many others" also claim to have been ripped off by Mr Christou.

The judge said the scam had been described as a "Ponzi scheme", although there was "more to it than that". Mr Christou "appeared to be a trustworthy and capable accountant and businessman" and had assured his victims they were investing "without risk to them".

Describing each of the victims as "vulnerable", the judge said that, although she was later repaid part of the cash, £70,000 was most of Mrs Goldberg's divorce settlement and Mr Christou would have been "well aware" that she had a dependent child and only modest earning capacity.

Despite his success in the motor trade, Mr Nicolaou had "little formal knowledge of financial matters", and Mr Zanelli, also a novice in financial matters who worked all hours in the sandwich bar, had family responsibilities for his sister, wife and children, one of whom has special needs.

The Zanellis were "impressed by the appearance of wealth and success of Mr Christou" and the cash they invested - including money from their parents - " represented the assets of the family".

The judge said none of the victims were likely to get any of their money back from Mr Christou, who put in no defence to the claims and against whom judgment was entered in December 2008.

However, they are now nearer recouping at least some of their losses after the judge ruled two of Mr Christou's former partners in Foster Squires "liable in law for the acts of Mr Christou".

There was no suggestion that fellow accountants, Milton Miltiadous and Simon Brougham, were in any way "personally party" to any advice give, or misrepresentations made, by Mr Christou to any of his victims.

The judge said Mr Miltiadous "had neither the inclination, nor the practical ability, to exercise any control over what Mr Christou did" and Mr Brougham " had very little idea of what Mr Christou was actually doing".

Niether disputed the deceit claims made against Mr Christou, but he had not acted with their authority and they argued they were themselves victims of a £225,000 fraud at his hands.

Nevertheless, the judge ruled, despite their innocence, that both of them are liable in law to compensate the victims of Mr Christou's misdeeds - limited to losses made whilst they were his partners - under the terms of the Partnership Act 1890.