Once A Crook, Always A Crook

• In 1994, Nazmu Virani was convicted of playing a vital role in helping the Bank of Credit and Commerce International (BCCI) to deceive the bank's auditors over its disastrous finances.      

• In May 1994. Nazmu Virani was jailed for two and a half years by an Old Bailey judge.

• In November 2006, Nazmu Virani lost a 24-year-long case in which he was claiming ownership of a multi-million shilling property, Athina Club House in Uganda.

•  In June 2009, Nazmu Virani resigned from the board of Cygnet Properties & Leisure Plc due to “ill-health.”

•  In July 2009, Nazmu Virani was declared bankrupt. He would have been required to quit anyway, because bankrupts are banned from serving as directors!

• In July 2010, Nazmu Virani miraculously recovered from his “illness” and rejoined Cygnet Properties & Leisure Plc board of directors!

 

The key documents in the false accounting charges of which Nazmu Virani was found guilty were Audit Confirmation Letters. These were requests from the bank to various borrowers selected by the auditors, confirming the balances owed on loan accounts. Having these requests signed gave the auditors an assurance that borrowers acknowledged the existence of the loans.

Similar comfort was given to the Bank of England when its officials read BCCI's financial statements. As one Price Waterhouse accountant put it, while the auditors were concerned about the honesty of some of those involved at BCCI, they thought it inconceivable that the customers were also involved.

The Serious Fraud Office (SFO) said it was the involvement of apparently respectable customers such as Virani that enabled BCCI to deceive the Bank of England into renewing its licence.

The SFO concluded: 'This meant that the bank could continue taking deposits from the public even though it was hopelessly insolvent, with the appalling consequences which followed for so many depositors and employees.'

The court found that Virani signed a series of falsified documents stating that his own private companies owed a number of debts to BCCI between 1987 and 1990. These 'loans' were treated by the bank's auditor, Price Waterhouse, as assets, the court heard. It affected the approach they took in assessing BCCI's true financial position.

The device was a means of fooling the auditor and inflating the bank's profits, Anthony Hacking QC, prosecuting, alleged in the trial which lasted more than three months. The help provided by Virani enabled BCCI to deceive the Bank of England into renewing its banking licence, the court heard.

In return, the prosecution alleged, Virani was granted huge loans by BCCI and given cash payments.

During the trial, Virani had claimed that his real crime was to fall victim of a cultural misunderstanding over the implications of the documents he signed and he had failed to read the documents before signing, as he was too busy doing property deals! 

In November 2006, Nazmu Virani, lost a 24-year-long case in which he was claiming ownership of a multi-million shilling property, Athina Club House in Kampala, Uganda.  The court of Appeal had upheld the trial judge’s verdict in which Nazmu Virani was found guilty of having fraudulently transferred the property into his and his father’s names in 1969!

The fraud case against Virani in Uganda has clearly shown that his statements to the Court in London during the BCCI trial were untrue, as he was already involved in fraud in 1969, before coming to the UK!

"You can fool all the people some of the time, and some of the people all the time, but you cannot fool all the people all the time." Abraham Lincoln

Useful Links:

http://www.independent.co.uk/news/business/virani-convicted-over-role-at-bcci-former-control-securities-chief-faces-jail-sentence-for-part-in-banks-activities-1433357.html 

http://indiatoday.intoday.in/story/asian-millionaire-nazmu-virani-convicted-over-bcci/1/293381.html 

http://www.independent.co.uk/news/business/viranis-sentence-shortened-by-elegant-defence-speech-1435427.html

http://www.growthcompany.co.uk/features/3689/nazmu-virani.thtml

http://www.cygnetproperties.co.uk

 

 

Athina Club House Case

http://www.ulii.org/ug/judgment/supreme-court/2006/21

 

The following article was published in the Times on 17 November 2007:

Here is a name from the past – Control Securities, one of those 1980s scandals that ran alongside Polly Peck and led to the jailing of its creator, Nazmu Virani. He became tangled up in yet another, the bent bank BCCI, and was lucky to get just two and a half years.

The occasion was a dinner at the Berkeley Hotel to mark the retirement of Colin Wellstead, who during his 25 years at Christie & Co, the property agent, has probably sold tens of thousands of pubs and restaurants.

His boss Chris Day recalled how he and Wellstead were once asked by Virani himself to value a package of 25 pubs in Liverpool. Virani was insistent that a desktop valuation would suffice and there was no need to visit the pubs. But when no trading figures were forthcoming Wellstead smelt a rat. He decided a site visit was necessary. Day received a call from Wellstead. “I’ve been to six of the addresses and they’re either burnt out or bombed out.”

http://www.thetimes.co.uk/tto/business/columnists/article2617854.ece 


Bank of Credit and Commerce International Fraud

https://en.wikipedia.org/wiki/Bank_of_Credit_and_Commerce_International

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