A Scammer’s Conviction
In a significant legal victory, the Official Receiver has secured a multimillion-pound payout to compensate victims of a sophisticated investment scam. The case revolves around John Gerard Metcalfe, a resident of Essex, who faced bankruptcy in 2013 following legal action. Metcalfe had defrauded multiple individuals and at least one company, orchestrating an elaborate investment scam that resulted in the loss of over £2 million for his victims.
Compensation and Legal Proceedings
Metcalfe faced the consequences of his fraudulent activities in 2017 when authorities convicted him of fraud offenses. Subsequently, the Crown Prosecution Service (CPS) obtained a compensation order, obligating him to repay the amount equivalent to his available funds at the time.
This order also allowed the CPS to seize additional funds should Metcalfe come into money in the future, ensuring full compensation for the victims and creditors.
A Windfall and an Asset
However, in 2023, a new twist emerged in the case. The Official Receiver, responsible for overseeing Metcalfe’s bankruptcy, discovered that he had received a £3.75 million payout from the Foskett Panel.
An independent committee established this panel in 2020 in response to a colossal banking scandal involving a billion-pound fraud at the Reading branch of HBOS between 2003 and 2007. Although they had discharged Metcalfe from bankruptcy in 2014, the compensation awarded for the fraud had taken place before the Bankruptcy Order.
Consequently, the payout became an asset within his bankruptcy estate, entitling creditors and victims to their due payments.
Collaborative Action for Justice
The Official Receiver was alerted to the payout by the Eastern Region Special Operations Unit and the CPS, who had learned of it from Metcalfe’s solicitor. Recognizing the importance of swift action, the CPS, police, and the Official Receiver closely collaborated.
Metcalfe agreed to participate in the CPS Voluntary Reparation process, designed to provide compensation to victims, thereby avoiding the need for a costly formal Proceeds of Crime Act 2002 (POCA) application to court.
A Path to Compensation
They determined that the fairest approach was to give priority to Metcalfe’s remaining victims as creditors in the bankruptcy proceedings. This choice resulted in the transfer of the Foskett Panel’s compensation award to the Official Receiver, enabling the return of over £2 million to the victims of Metcalfe’s investment scam.
Furthermore, other creditors received their rightful repayments, and HMRC received approximately £750,000 in outstanding dues.
The Verdict of Justice
Joe Sullivan, Official Receiver at the Insolvency Service, expressed satisfaction with the outcome, stating,
“That is a testament to the hard work of the team, and I am especially pleased in this case that John Metcalfe’s victims have been repaid after his appalling scam.”
Nick Bentley, Financial Investigation Manager at ERSOU’s Regional Organized Crime Unit, emphasized the commitment to ensuring justice for victims of economic crime, asserting,
“We will continue to work with partner agencies and use POCA legislation to ensure, wherever possible, victims of economic crime are compensated.”
Mark James-Dawson, Specialist Prosecutor of the CPS Proceeds of Crime Division, emphasized the commitment to pursue criminals for their ill-gotten gains, even years after their convictions.
He highlighted the Voluntary Reparation scheme as a means to secure compensation for victims when further assets come to light, commending the collaborative effort that enabled the recovery of significant funds for the victims.