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Seven people sentenced in £1.5m mortgage fraud case

A business man, members of his family and his solicitor were all involved in the scam.

SEVEN PEOPLE HAVE been sentenced today after admitting involvement in mortgage fraud amounting to more than £1.5 million in Northern Ireland.

Businessman John Gaile set up a scam with members of his family and solicitor John Hickey, which involved applying for mortgages using inflated purchase prices for business and residential properties, mainly in the Coleraine area of Derry.

The majority of mortgages sought had been obtained using the services of an independent financial advisor, William Larmour. This meant banks and building societies gave larger loans than would otherwise have been available to Gaile, who benefited by having to contribute less from his own funds.

From September 1995 to April 2008, he sold these properties, sometimes to family members or to Hickey, either taking the profit gained or using it to fund the purchase of another property whose mortgage was similarly obtained.

It has been calculated that the total value of the mortgages obtained was in excess of £1.5 million and police say the total profit to all seven defendants amounted to more than £483,000 while the loss to lenders through repossessions amounted to more than £557,000.

Though the sentencing took place last just, it has only been made public today following the completion of other proceedings against another defendant.

  • John Gaile got a two year jail sentence, suspended for three years, for 19 counts involving obtaining services by deception, acquiring and converting criminal property (money laundering)
  • John Hickey – two years’ jail, suspended for three years, for 51 counts involving obtaining services by deception, fraud by false representation and money laundering
  • William Larmour – conditional discharge for failing to disclose money laundering
  • Paul Gaile (brother of John Gaile) – one year in jail, suspended for three years, for two counts of money laundering.
  • Lena Gaile (wife of Paul Gaile) – six months in prison, suspended for two years, for two counts of money laundering
  • Lee Paul Gaile (son of Paul and Lena Gaile) – six months in prison, suspended for two years, for three counts of money laundering
  • Kieran Gaile (son of John Gaile) – conditional discharge for two counts of obtaining services by deception and fraud by false representation.

“This case is a reminder to anyone who thinks they can get away with large scale fraud that there is every likelihood they will be apprehended by police and have to suffer the consequences, financial and otherwise,” commented Detective Constable Sam Kinkaid, from Organised Crime Branch.

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