BusinessCompany NewsAccountant found guilty in £3m Ravelle fraud case

Accountant found guilty in £3m Ravelle fraud case

Jeremy Greene found guilty of fraudulent trading at Manchester Crown Court in £3m invoicing scam

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.

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