John Gerard Metcalfe, from Essex, was declared bankrupt in 2013 following legal action after he defrauded several individuals and at least one company as part of an investment scam he had run, which saw the victims lose over £2 million.
Metcalfe was subsequently convicted of fraud offences in 2017 and the Crown Prosecution Service (CPS) obtained a compensation order, meaning that he was required to pay as much as he had funds for at the time. It also meant that if Metcalfe came into money at a future date, the CPS could order additional money to be distributed, ensuring that the victims and creditors could receive full compensation.
However, in 2023, the Official Receiver, responsible for overseeing Metcalfe's bankruptcy, became aware that Metcalfe had received a £3.75 million pay-out from the Foskett Panel, an independent committee set up in 2020 following a banking scandal involving a billion-pound fraud at the Reading branch of HBOS between 2003 and 2007.
Although Metcalfe had been discharged - as normal - from bankruptcy after one year in 2014, the fraud which led to the compensation award had happened prior to the Bankruptcy Order and the pay-out was therefore an asset in his bankruptcy, with payments due to his creditors and victims.
The Official Receiver was also contacted by the Eastern Region Special Operations Unit and the CPS, who had learnt of the pay-out from Metcalfe's solicitor. The CPS, police and the Official Receiver worked together closely, resulting in Metcalfe agreeing to take part in the CPS Voluntary Reparation process, which provides for compensation to be paid to victims, and in place of a costly formal Proceeds of Crime Act 2002 (POCA) application to court.
It was agreed that the best approach was to pay his remaining victims as creditors in the bankruptcy. As a result, the compensation awarded by the Foskett Panel was paid to the Official Receiver, allowing over £2 million to be returned to the victims of his investment scam. In addition, other creditors have also been repaid and the taxpayer also received around £750,000 which was owed to HMRC.
Joe Sullivan, Official Receiver at the Insolvency Service, said:
Although this bankruptcy case dates back ten years, I am very happy both the victims and creditors are finally able to get their money back. That is 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 Organised Crime Unit, said:
Our unit works closely with police forces across eastern England - in this case Essex Police - to ensure that crime doesn't pay, and individuals who have made money through illicit means are ordered to repay their ill-gotten gains.
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, said:
This case shows that even when criminals have been convicted and sentenced, the CPS will continue to pursue them for their ill-gotten gains - even if they come into money years after committing their crimes.
Our Voluntary Reparation scheme is a mechanism by which we can secure compensation for victims after the criminal and confiscation proceedings have finished, when further assets come to light. Through joint working with the police and Insolvency Service, we were able to recover significant funds from Metcalfe which will be used to compensate victims of this crime, money which they thought they'd never see again.
