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Wallace Smith found guilty of fraudulent trading

Melvyn Howe
Thursday 24 February 1994 19:02 EST
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WALLACE SMITH, the merchant banker, was found guilty yesterday of operating a pounds 100m fraud, writes Melvyn Howe of the Press Association.

The once-respected Canadian-born businessman, who used some of the money he illegally siphoned from his merchant bank to help to fund a Thatcherite pressure group, showed no reaction as the verdict was announced by an Old Bailey jury.

Smith, a 59-year-old father of three, was convicted of one charge of fraudulent trading between May 1990 and April 1991 and two counts of obtaining property by deception.

He was found not guilty of three charges of theft involving certificates of deposit worth pounds 8m, and was also cleared - on the judge's direction - of an allegation of false accounting.

After the jurors delivered their unanimous verdicts, Mr Justice Tuckey gave them a majority direction before sending them out again to resume deliberations on a second charge of false accounting.

During the three-month hearing, the court heard how the chairman of Wallace Smith Trust carried out the long-running and sophisticated swindle under the noses of the Bank of England, his auditors and fellow directors.

Smith, of Brewers Lane, West Tisted, Hampshire, left a bevy of banks and financial institutions millions of pounds out of pocket. He routed pounds 12,000 of it through a Canadian front company to pay for a year's rent on the offices of the anti-federalist Tory Bruges Group, in London's Jermyn Street.

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