Serious Fraud Office
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Convicted fraudster found to be in contempt of court

At the High Court recently (29 July 2022), Dr Gerald Martin Smith was held in contempt of court for breaching a restraint order that prevented him from spending or accessing his assets, except in limited circumstances. He admitted a total of three separate breaches and accepted the facts as presented at court by the SFO.

Smith was sentenced to eight months in prison, but his sentence was suspended for 18 months. Should he commit any criminal offence during that period, he can be brought back to court and the suspended sentence may be activated.

Through the use of its powers under the Proceeds of Crime Act 2002 in relation to those subject to confiscation investigations, the SFO uncovered that Smith had been using previously unknown online banking facilities, in breach of the restraint order.  

An analysis of Smith’s spending on each of the accounts by the SFO revealed that he had been funding a lavish lifestyle including spending at bars, restaurants and wine merchants, with withdrawals totalling more than £57,000 over 15 months.

Smith previously pleaded guilty in April 2006 to misappropriating over £34 million in funds from Izodia Plc. He admitted to ten counts of theft and one count of false accounting. He was subsequently issued with a confiscation order of over £40 million, the largest ever in criminal proceedings at the time, and sentenced to eight years’ imprisonment.

At a previous contempt hearing in May 2022, Smith admitted two instances of contempt in using the accounts. That hearing was adjourned following the discovery of a third account. Today, Smith admitted to a third instance of contempt.

SFO relentless in hunt for justice

Handing down the sentence, Mr Justice Butcher recently said:

“The Defendant deliberately failed to disclose the existence of the accounts. There is no doubt in my mind that in these circumstances, the defendant is in contempt of court.”

Referring to the breaches of the restraint order, Mr Justice Butcher continued:

There is no doubt that the breaches were substantial. This is a serious matter. The breaches were intentional, there were three of them and they were over a significant period of time.”

Emma Luxton, Head of Proceeds of Crime and International Assistance at the SFO, recently said:

Gerald Smith has repeatedly failed to co-operate in the repayment of his confiscation order and has now flagrantly disregarded the restrictions imposed on his assets.

“Having displayed such clear contempt for the rule of law, today’s ruling is welcome news.

“The SFO is resolute in the pursuit of justice and refusal to accommodate those attempting to conceal the proceeds of crime, no matter how many years have passed since their crimes were committed.

Notes to Editors:

  • The Serious Fraud Office fights complex financial crime to deliver justice for victims and protect the UK’s reputation as a safe place to do business. We investigate and prosecute the most serious or complex cases of fraud, bribery and corruption.
  • Smith previously served a two-year prison sentence in November 1993 after being convicted of stealing £2m from a pension fund.
  • Kennedy Talbot QC represented the SFO.

 

Channel website: https://www.sfo.gov.uk/

Original article link: https://www.sfo.gov.uk/2022/07/29/a-twice-convicted-man-behind-a-34-million-fraud-has-been-held-in-contempt-of-court-after-the-serious-fraud-office-sfo-uncovered-three-secret-bank-accounts-held-in-his-name/

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