Illegal money lender receives jail sentence

Illegal money lender receives jail sentence

Dharam Prakash Gopee was sentenced on Friday to three and a half years imprisonment by a Judge in Southwark Crown Court after guilty verdicts for offences under the Consumer Credit Act 1974 and the Financial Services and Markets Act 2000.

In addition to this custodial sentence, the 64-year old has been issued with a Serious Crime Prevention Order (SCPO), which will severely restrict his ability to carry out this type of crime in the future. This is the first time the Financial Conduct Authority (FCA) has sought such an order, which underlines the seriousness of his conduct.

Between 2012 and 2016, Gopee acted as an illegal lender despite being refused a consumer credit licence by the OFT, or securing any authorisation from the FCA. He loaned money to vulnerable consumers at high rates, securing the loans against their property, and then sought to take possession if they failed to pay. Over the four year period, his own loan books showed that he issued approximately £1 million of new loans and took in at least £2 million in payments from old and new consumers, none of whom were aware that did not have a licence.

The SCPO will begin on Gopee’s release from custody, and will last for five years. It includes conditions prohibiting him from conducting any business in the credit sphere, limits the number of bank facilities he is permitted to operate, and requires him to make disclosures of those banking facilities to the FCA. Breaching the terms of the order is a criminal offence, punishable by up to five years’ imprisonment.

In sentencing Gopee, trial judge HHJ Beddoe noted that Gopee was aware of the regulators serious concerns, but ignored them, deciding instead to “… deliberately flout the law” ignoring the fact that he had lost his licence, and endeavouring to enforce agreements he knew were unenforceable but that debtors did not. He continued to pressurise debtors with demands for payment, threatening court action that he knew could not be sustained.

Commenting on the defendant’s activities as a whole, the judge said that Gopee’s business practices “… exploited the weaknesses and vulnerabilities of many, many people …” who were unaware that their trust in him was misplaced. He described the new scheme constructed by Gopee as involving one contrivance after another in an attempt to get around the law, showing “a horrid pattern of exploitation”.

Mark Steward, director of enforcement and market oversight at the FCA, said: “The court is sending a very clear message that deliberate and repeated offending will lead to long periods of imprisonment. Today’s decision also imposes the FCA’s first Serious Crime Prevention Order which will severely inhibit Mr Gopee’s ability to reoffend and should protect consumers in the future. The FCA will continue to take whatever action is necessary to bring offenders to justice and protect consumers.”

Gopee had already been banned from acting as a company director, having been disqualified on 5 May 2016 for the maximum period permissible of 15 years under the Company Directors Disqualification Act 1986. A number of his companies have already been wound up in the public interest following proceedings by the Official Receiver, and he has also been the subject of a restraint order obtained by the FCA on 25 June 2015 under the Proceeds of Crime Act 2002.

Following the lifting of a reporting restriction, we are now able to report that the FCA had to bring two sets of proceedings against Gopee for contempt of court in relation to repeated breaches of that restraint order.

In April 2016, having denied various breaches – including failing to disclose assets, continuing to deal with assets, opening and using new accounts – Gopee was found to be in contempt and imprisoned for a term of 18 months. He was released early by the court in September 2016 having promised to comply with the order. However, he went on to commit various additional breaches. Further proceedings were therefore brought against him, and on this second occasion, having admitted the new breaches he was imprisoned for a term of 15 months in October 2017, in the lead up to his criminal trial.

Gopee continues to serve his 15 month term of imprisonment for contempt, and his sentence for the recent offences will begin after that term has been completed in June 2018.

Proceedings have now begun at Southwark Crown Court to confiscate the proceeds of Gopee’s criminality.

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