Shaun Kiely was the director and shareholder of Sky Properties (Northern) Limited, a property development and real estate business, and of S-Mart Stores Plc, a chain of small retail outlets in locations across the UK.
Kiely was found guilty of deceiving seven investors in 2005 by promoting the S-Mart stores, which were managed by staff he appointed, as profitable businesses when very little trading was being conducted.
Before and during 2005, SPN purchased over 50 low value commercial retail properties across the country and created 20-year commercial leases to S-Mart for the properties before selling on the freeholds at auction.
The properties were promoted as a chance to invest in a ‘going concern’, but S-Mart was not a profitable business.
Rather than running S-Mart as a retail company long term, Kiely intended to make quick short-term profits by selling the freeholds on to buyers unaware the properties were leased by a company whose turnover was too low to cover its rental obligations.
He was found guilty at Preston Crown Court in May 2011 of obtaining money transfers by deception and of false accounting.
Confiscation proceedings have begun.
Sentencing Kiely today, Judge Gibson said that “the jury accepted that there was a lie at the heart of the case” and told Kiely: “The sign of your calculation was that at first sign of failure, rather than improve trade by investing money, you walked away.”
Richard Alderman, director at the Serious Fraud Office, said: “Shaun Kiely abused the trust of the people who invested in his business. They expected a return for their money, but all they got was worry and distress. I am very pleased that justice has now been served.”
