- Created: Monday, 19 March 2012 11:29
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The Merseyside Echo reports today that a gran is facing having to pay back millions of pounds embezzled from home appliance manufacturer Glen Dimplex.
Shelagh Smith worked at the Prescot-based former Stoves factory as a purchase ledger supervisor for more than 20 years and has admitted to a court of stealing £2.8 million over five years.
A hearing before the High Court’s Commercial Court was told Mrs Smith has accepted responsibility for the money which started disappearing in 2005 but was only found to be missing five years later.
Her husband Roy and daughter Karen Lewis have both deny any involvement in the fraud.
The court was told Mrs Smith and her husband, who also worked at the Stoney Lane factory before retiring with a £230,000 pay-off after an industrial accident, had a joint income of around £30,000 a year yet lived well beyond their means.
The fraud was uncovered when Mrs Smith suddenly disappeared in October 2010.
In a judgement to the court Jonathan Hirst QC said, without telling friends or family she fled to Edinburgh for a week before returning “depressed and tearful, no longer in control of herself”.
While she was absent accountants at Glen Dimplex are said to have uncovered falsified bank statements and payments to suppliers.
The money, the court heard, was actually paid into the Smith’s joint account and that of their daughter Mrs Lewis.
When she was dismissed and company solicitors got a court order to search the family home in Prescot, Mrs Smith tried to take her own life. Suicide notes were found on her after she took an overdose of pills that have been taken by the court as a confession of guilt.
In those notes she apologised to her husband for “fibbing” to him, telling him “all the terrible things you are going to find out about, I did in my own stupid way to keep the kids safe and happy”.
She confessed to telling their daughter the story she told her about the source of the money was “a lie” and in an open note to the rest of her family said she had done “dreadful things”.
Investigators have sifted through paperwork and took Mrs Smith to the High Court in an attempt to get the cash back.
A summary judgement was issued ordering her to pay back the full amount plus the company’s costs.
In his judgement Deputy Judge Hirst said: “I find it established beyond doubt that Mrs Smith engaged in a fraud on the Claimant [Glen Dimplex] starting on 3 June, 2005 and that she stole a total of at least £2,811,904.30.
“She submitted to judgement for £2,800,000 plus costs. Mrs Smith’s greed and dishonesty have brought disaster to her family.”
According to the judgement passed down by the court the fraud began on June 3, 2005, two months after Mr Smith’s retirement, when Mrs Smith arranged for £29,252.60 to be paid from Glen Dimplex to the couple’s joint account at the Natwest Bank.
More than £2.1 million was transferred into the couple’s joint account or their individual accounts over the next five years without suspicion being raised.
An extra £700,000 was paid directly from Glen Dimplex to Mrs Lewis’ Barclays bank account over the same period.
In the High Court hearing her 65-year-old husband claimed he had been “duped” and had no idea where the money was coming from. Mr Smith said after the downsizing of their home and the subsequent release of equity and his pay-off and pension he thought they were “cash rich”.
In his defence to the court Mr Smith said following his accident in 2003 he has been on medication which impaired his memory. And shortly after the accident Mrs Smith assumed total responsibility for and control of their finances.
Mr Smith said the first he knew of the accusations was when solicitors searched the family home in November 2010. But after his wife disappeared it is alleged he virtually emptied her two accounts, the joint account and cashed in an Aviva bond worth £84,000 before putting the cash into an account solely in his name.
Judge Hirst said: “Mr Smith says that he was affected by the painkillers given to him to mitigate the effects of his injury.
“I do not in any way discount the severity of his injury. But it is right to observe that he continued to drive long distances and he played golf.
“Although he may well have handed over the management of the family’s finances to Mrs Smith he spent very large sums of money himself – over £400,000 over six years – and he cannot have been unaware of the dramatic improvement in their general standard of living.
“It is quite clear that the financial transactions after Mrs Smith's disappearance were effected by Mr Smith.
“He does not really dispute this. His conduct is not of a man unable to handle finances.
“On the contrary it shows that he was able to take decisive action which had the clear effect of dissipating Mrs Smith's cash resources and of removing jointly held assets.
“I think that it points strongly to a man knowing that the fraud (of which he was aware) had been discovered and that he needed to try and preserve the family's assets from the inevitable claims that the claimant would bring against Mrs Smith.”
Mrs Lewis, a 42-year-old Asda worker and mum-of-two, said she was also duped by her mum. She was led to believe her dad was paid more than £1 million when forced to quit work and the monies paid to her were gifts from his compensation.
Glen Dimplex have taken both to the High Court on the grounds they “dishonestly assisted” Mrs Smith, knew where the money was coming from and are liable with her to pay it back.
Deputy Judge Hirst said those claims against Mrs Lewis would have to go to trial but he “reached the opposite conclusion” in relation to Mr Smith.
Mr Hirst said: “I am sure that he must, at the very least, have strongly suspected that Mrs Smith was stealing from her employer and deliberately closed his eyes and ears and deliberately did not ask questions in case he learned something he would rather not know.
“I think it highly likely that actually he was fully aware of what Mrs Smith was doing but a deliberate closing eyes and ears and a deliberate failure to ask blatantly obvious questions for fear of what he would learn amounts to dishonesty.”
Since the decision Mr Smith has applied to the Court of Appeal for the right to challenge it. A two-day trial involving Mrs Lewis has been set for April 2nd and 3rd.
Despite the High Court developments a long-running investigation by Merseyside police is still ongoing.
A police spokesman said: “Three men, aged 49, 51 and 65, and three women, two aged 42 and one aged 63, have been interviewed under caution as part of the investigation.”