MORIN: BANKER COUPLE GET 6 YEARS FOR £1M MORTGAGE CON
A banker couple who created forged documents to pull off a £1 million mortgage fraud were jailed for a total of six years today (Weds).
Clive Palumbo, 37, and lover Tracey Morin, 32, tricked bosses at Royal Bank of Scotland into believing prospective borrowers would be able to meet their monthly repayments.
They drafted tenancy agreements showing buy-to-let properties were to be rented by international news agency Reuters.
But the documents were forgeries and once the cash was paid out the borrowers simply vanished without making any repayments.
Palumbo had previously worked at Reuters and created the tenancy agreements using the names of two former colleagues, enlisting Morin to help with the forgeries.
But the documents were riddled with errors, including an incorrect spelling of the world-famous firm’s name.
The pair, who denied fraud, were convicted after a trial at the Old Bailey and each handed a three year prison term – despite Palumbo’s plea to be spared jail so he could volunteer for homeless charity Crisis at Christmas.
The judge, Mr Recorder Oliver Sells QC, told them: ‘You were both in a position of trust and expected to protect legitimate financial interests.
‘Each of you breached that trust in a way which can only be described as grave.’
But he did not order them to compensate the bank after saying he could not be satisfied they had the means to pay back the cash.
‘Others were plainly involved,’ he added.
‘In the circumstances, unsatisfactory as they may, in my judgement it is not appropriate to make any order for compensation against either of your, nor any order for costs.’
Palumbo, a senior relationship manager at RBS’s Islington High Street branch in north London, agreed to arrange the mortgages in early 2007 for clients Richard Norton and Neil Marigliano.
Both wanted to buy flats at the exclusive Skydec development in Heathfield Road, Wandsworth, south London, to let out and applied for interest-only loans.
Mr Marigliano’s mortgage was to be for £630,000 of the £840,000 purchase price and Mr Norton’s for £475,500 of the £610,000 price.
Both were approved subject to the rental income cover the cost of the mortgage repayments.
‘But the rental income was wholly insufficient to meet the costs of the mortgage repayments,’ said prosecutor Philip Stott.
‘It was no doubt obvious from that point that these applications were going to be refused because they simply weren’t viable.
‘Following this, Mr Palumbo told a colleague that a “blue chip company”, in his words, wished to rent both properties at a rental that would in fact be acceptable and cover mortgage repayments.
‘Ms Morin then handed over the two tenancy agreements in person.’
He added: ‘In fact, these were never signed by Reuters.
‘You may think it surprising that a company the size of Reuters would spell its own name wrong on a tenancy agreement in any event.’
Morin, who worked at RBS’s South Kensington branch, and Palumbo had begun a fling around this time and only broke off their relationship when the fraud investigation began.
The mortgages were granted and the cash dished out, but no repayments were ever made and the borrowers have never been traced.
RBS subsequently repossessed both flats and sold them at auction for just £300,000, making a loss of around £700,000.
It was later discovered that another fraudulent mortgage had been taken out on one of the flats.
This was possible because the mortgages were never logged with the Land Registry and did not show up during legal searches.
‘Undoubtedly there are other involved in this fraud,’ Mr Stott told jurors.
‘It may well be they have been involved in other mortgage frauds.
‘But at the end of this case you can be sure of each defendant’s guilt regardless of the involvement of any other fraudsters.’
Palumbo, of (Flat 2, 8) Hatcham Park Mews, New Cross, se London, and Morin, of (Flat 12, Shackleton Lodge, 15) Gleneagle Road, Streatham, sw London, each denied two counts of fraud by abuse of position.
