In 2006, Gerald Smith – the chief executive of now defunct Jersey-registered company ORB, was sentenced to six years in prison after committing a £35 million fraud by illegally obtaining money from an IT company.
According to court documents, he was handed a confiscation order to pay a total of £41 million to the UK government but this has since risen, due to interest, to nearly £70 million.
Mr Smith is now facing moves which could see him sent back to prison if he continues to refuse to pay. He has since made clear that he is ready to fight any such attempt and that he should instead have some of his debt written off.
The latest twist in the long-running legal battle follows the release of documents from the UK’s Serious Fraud Office last year, which indicated that the fraudster used private jets to fly between Jersey and a number of destinations including Ibiza, Barcelona, Mallorca, Malaga and Geneva.
He is also alleged to have travelled further afield, taking three one-way British Airways flights to Dubai costing £49,425, £34,752 and £17,200 respectively.
At the time of the documents’ release, in June last year, the SFO claimed that he had taken 360 flights in the past five years to destinations including Vancouver, Toronto, Buenos Aires and the Maldives.
In 2013, he also travelled frequently between Jersey and Gatwick – taking 46 flights on the route on scheduled passenger flights from April until December.
In documents submitted to Folkestone Magistrate’s Court by the SFO, it is also alleged that a ski lodge in western Canada, land near Lake Como, land in Umbria, 14 flats in a north London mansion block, two villas in Majorca and a a £12 million home near Government House in St Saviour, had all been bought by Mr Smith’s criminal profits.
But, according to a witness statement submitted to Folkestone Magistrate’s Court in November, Mr Smith claims there is ‘no basis’ that will allow the court to find that he has a ‘wilful refusal or culpable neglect’ to pay the outstanding debt.
And he has claimed that his travel and lifestyle has been paid for mostly through a £12 million litigation fund run by his brother, money from his former wife – Dr Gail Cochrane – and his former father-in-law.
The case has now been adjourned until later this year to allow Mr Smith to provide a more detailed explanation of his spending so that the court can decide whether or not he should be jailed for non-payment.