Businessman in £16m finance scam
By Alex Lewis
BUSINESSMAN Kevin Smedley is facing a multi-million pound bill for damages after a court found he had been involved in a gigantic financial scam.
Mr Smedley, of Antonine Gate, St Albans, former finance director of City Trucks Group, has been found jointly liable with a fellow director, David Gee, to pay £16,044,000 to an American finance company.
After a lengthy civil trial, High Court judge Michael Tugendhat found the pair had acted in a deceitful conspiracy against GE Commercial Finance.
A more junior employee, Kevin Ritchie, was exonerated as he had acted under Mr Smedley’s instructions.
The judge said: "Mr Smedley gave the figures to Mr Ritchie that Mr Ritchie entered, and Mr Smedley looked at the account.
"He knew it was overstated, but did nothing to inform GE. He knew that the figures communicated to GE were false.
“This is a clear case where Mr Ritchie has been corrupted by Mr Smedley.”
Mr Smedley and his co-defendants worked at the headquarters of City Truck Group in Newport Pagnell, Buckinghamshire.
The company, which started trading in the 1970s, rented out vehicles and provided a distribution service from depots throughout Britain.
In February 2001, the company set up a deal with GE to improve its cash flow, under which debts from its customers were sold at a discount of 15 per cent.
By December 2001, about £24 million had been provided by GE in exchange for debts, many of which were either fictitious, double-counted or not of the type covered by the agreement.
Mr Smedley told Mr Ritchie to make false entries in the computerised records to satisfy auditors appointed by GE that all was well.
False documents were prepared, and steps taken to obstruct the auditors and throw them off the scent.
But the conspiracy came to light when other employees in City Trucks blew the whistle.
GE put City Trucks into administration, but found that many of the customer debts which it hoped would cover its losses were non-existent. It was able to recover only about £8 million from the company’s assets, after paying the costs of the administration and launched the court action against the directors to recoup the rest.
In the trial, Mr Smedley and Mr Ritchie blamed each other, while Mr Gee, the managing director, denied all knowledge of the deceit.
Mr Smedley claimed the non-existent debts entered in the sales ledger were “provisions” or “accruals”.
But the judge said he had changed his story and his explanations were not credible.
Awarding judgement to GE Commercial Finance, Mr Justice Tugendhat said Mr Smedley might not have benefited personally, as most of the company’s shares belonged to Mr Gee, but had acted in a bid to keep it afloat.
The businessman, who may also have to pay costs and interests, is under criminal investigation by the City of London Police. He did not wish to comment to the Review.
12:51pm Tuesday 25th October 2005
full story here
do hope they are made to pay it back 
international paper out of winsford 
then transferred to Trafford park depot! 