LONDON, Jan 17 (Reuters) - A British judge sentenced a faketycoon who defrauded two banks out of 769 million pounds toseven years in jail on Thursday but said the banks bore someresponsibility because of their poor checks.
Achilleas Kallakis, 44, was convicted of fraud on Wednesdayfor obtaining 740 million pounds ($1.18 billion) in loans fromAllied Irish Banks on false premises, in one ofBritain's biggest real estate scams. He used the money to buyproperties and fund a millionaire lifestyle.
Kallakis obtained another 29 million pounds to convert aferry into a super-yacht from Bank of Scotland, now part ofLloyds also under false premises.
Co-defendant Alexander Williams, 44, was sentenced to fiveyears in jail for producing forged documents to back upKallakis's fake claims to the banks.
"The two banks, Allied Irish Banks and Bank of Scotland,have undoubtedly acted carelessly and imprudently by failing tomake full enquiries before advancing the money," said judgeAndrew Goymer, delivering his sentence.
"While I do not equate the position of the banks with thatof a householder or car owner who forgets to secure his house orcar and becomes the victim of burglary or theft, they do bearsome responsibility for what happened."
The judge noted that Bank of Scotland had been warned by itslawyers about the risks of accepting a particular letter ofassurances from a Swiss lawyer backing up Kallakis's applicationfor a loan.
"It almost beggars belief that senior management chose todisregard that warning in its rush to complete the deal at allcosts," he said.
"It is however quite apparent that both defendants took fulladvantage of the prevailing banking culture in which cornerswere cut and checks on applications were superficial andcursory."
Lloyds (LLOY)