Property developer Afzal of Birmingham was originally sentenced in June 2011 to 13 years’ imprisonment for a £49m mortgage fraud. His brother Nisar Afzal is still on the run after a warrant for his arrest and is thought to be in Pakistan.
The offences, committed between 1 April 2004 and 15 January 2006, involved two counts of conspiracy to obtain money transfers by deception and four counts of obtaining a money transfer by deception.
In August 2006 he was ordered to pay £29,276,565 confiscation within six months or incur a default sentence of ten years’ imprisonment. Today, the outstanding balance of the confiscation order is £30,965,879.50 which is accruing interest at £6,396.50 per day.
The default sentence imposed today will be served after the original sentence unless the confiscation order plus accrued interest is paid in full.
Afzal pleaded guilty on 17 January 2011 alongside his partner in crime, surveyor, Ian McGarry who was sentenced to seven years.
At the time, the judge highlighted several aggravating features that impacted on the sentence handed down to Saghir Afzal. These included the fact that Saghir Afzal personally benefited from the fraud and sent over £26m to Pakistan, where it remains under his control, or that of his brother Nisar Ahmed Afzal.
The evidence before the court was that there was a close partnership between the Afzal brothers such that their roles in the fraud could not be distinguished.
The police started an investigation after an anonymous tip off from a member of the public who reported their suspicions about the sale of a property to the Cheshire Building Society.
The Serious Fraud Office revealed that in addition to the Cheshire Building Society, the Bank of Ireland, Société Générale and the Nationwide Building Society had also been defrauded.
The fraud involved McGarry providing Afzal and his brother Nisar Ahmed Afzal with false valuations based on fictitious leases, which were used to support fraudulent mortgage applications on six commercial properties.
The false valuations enabled the Afzals to deceive lenders to loan £50m on properties worth £5.6m, equivalent to an LTV ratio of 866%. In one case, McGarry valued a property at £19m that had been purchased for £1m, representing an overvaluation of 1800%. In another instance, he produced three difference valuations of the same property on the same day, for three separate financial institutions.
Co-defendant Ian McGarry is contesting the confiscation order with no current court date fixed.