The new pursuit of profit rots the old bonds of trust

The Guardian, September 18 1993

Until a few years ago, there used to be a gigantic old elm tree in the middle of Ramsbury. It was so big that it held an umbrella of branches over the whole village square and, according to Wiltshire legend, the hollow cleft in its centre had once been the home of a witch called Maud Toogood who warned that if the old elm ever fell, the village would fall with it.

The old elm was a natural monument to Ramsbury’s wealth and beauty. Villagers could sit in its shade and gaze down the gentle curve of the High Street, past the sagging bow window of Hills Store (groceries and provisions, estd 1794); past Mr Gilbert the butcher, who is famous for miles for his pork and cider sausages; past Holy Cross Church, which was once so prestigious that it had its own bishop; and on past the Post Office with its window full of notes about coffee mornings and village fetes; and they could reflect that they lived in a place that was forever England.

While the old elm stood in the village square, its powerful limbs embraced all that was best in Ramsbury. The long-established law firm of Phelps and Lawrence, who first practised when Charles Dickens was a boy, settled under its branches with their neighbours, the Ramsbury Building Society, the trusted protectors of the village cash for 150 years, and the Bell, the black-beamed inn which fills the western side of the square. Here, the professional middle classes – the accountants and businessmen who had bought the best of the Georgian rectories and the Victorian villas – gathered each evening at six for a pint of Wadworths. They drank together, they dealt together, they trusted each other.

Looking back now, it is hard to be sure exactly when it all started to change. It is tempting to say that it must have been the day in October 1986 when the rot in the old elm became so bad that workmen were ordered to take chainsaws to its roots and to pull it out of the ground, but the death of the elm is only a symbol of what was really happening to Ramsbury. Perhaps the first sign of some hidden change was in the mid-1970s when the property developer Harry Hyams moved into Ramsbury Manor. He was no criminal but he was notoriously greedy, famous for leaving his biggest London office block empty while its price rose. Now he invested some spare cash in half-a-dozen prime properties in the village, and, importing his avarice into his new home, he left them empty too.

If they missed the significance of the arrival of Mr Hyams, the villagers might have begun to suspect that there was something hollow beneath the traditional surface of life when the police arrested John Lawrence. He was the investment manager of the Ramsbury Building Society, a long-serving clerk to the parish council, an honoured guest of Her Majesty at a tea party at Buckingham Palace, a man whose status had been officially recognised at a special village celebration with a marquee in the Square and bunting all the way down the High Street. John Lawrence had been stealing his customers’ money – nothing subtle, he had simply been putting their cash into his pocket – and in 1985 he was caught and sent to prison.

Many villagers simply refused to believe that John Lawrence was guilty, but it became harder to miss the signs of rot in 1987 when Michael Swift-Peacock followed John Lawrence into disgrace. Swift-Peacock was an accountant who lived in style in Whitton Lodge on a hill at the top of the village overlooking the Kennet valley. He was well respected and trusted by local people who gave him their money to invest. He, too, stole it and he, too, was sent to prison.

The ancient certainties, which had been so firmly rooted in Ramsbury’s wealth, were being slowly hollowed out. Everyone in the village could continue to keep up appearances, but the truth was that the old lifestyle of the rural middle classes which had always swathed its members in peace and prosperity, which had allowed them the luxury of honesty and mutual trust, was breaking down. Stretched by the new commercialism, torn by the recession, the system was no longer delivering the goods – so some of them started to steal the goods instead. And Ramsbury finally knew beyond doubt that it had been deceived by its own appearances when the police arrested David Read and David Duff.

Everybody trusted David Read. He was a solicitor and everybody trusts their solicitor but, more than that, he was a Christian, a lay reader at Holy Cross Church who founded his own law firm as a Christian practice and used to hold prayer sessions with his partner in the office, but, most of all, he was a local man, a Ramsbury village man, born and brought up here and a prominent member of the Six O’Clock Club in the bar of the Bell.

David Read’s story begins – and this turns out to be important – in a council house. His father, Roland, was the village grocer, who kept a shop with a thatched roof on Oxford Street, which runs up the hill behind the Bell, and pedaled an iron bicycle with a basket strapped to the handle bars selling fruit and veg to his wealthy neighbours. Read went to the village primary school and then to St John’s grammar school five miles away in Marlborough and he emerged with a bursting desire to improve himself. He decided to become a lawyer.

He worked hard and was rewarded with his first job, working at the offices of Phelps and Lawrence. The old law firm had high hopes of their new recruit and Read’s ambitions went even higher but, in 1986, his dreams faltered when he was caught on the receiving end of a bout of vicious office politics and lost his job. The man who ousted him was David Duff, a large, garrulous Scotsman, then aged 32, who had made little secret of his desire to take over the firm since he had arrived in Ramsbury from Edinburgh.

There were some at Phelps and Lawrence who disliked David Duff. He was loud and he was pushy but, more than that, he was a little too free with the firm’s money. He seemed to spend all his time up in London with his cronies, running up huge expenses, sticking his fingers into all kinds of pies and bragging about work which never materialised. When an auditor started asking difficult questions, he sacked her. His colleagues could see nothing that was exactly improper, but it made them uneasy and some of them thought that David Duff would come to a sticky end one day.

But David Read was out of the firm. He struck out on his own, setting up his own practice in Marlborough, praying as the sun rose and working until it set, recruiting his friends and his neighbours as his clients, offering himself on all sides as the man you could trust with any problem. Need a mortgage? Need insurance? Need a loan? Need any help at all? David Read had the answer. His business boomed. He moved into swish new offices, recruited new partners and hung a signed photograph of Rumpole of the Bailey on the wall.

And soon he succeeded in an ambition which ran much deeper than mere professional success: he took off from his humble background and joined the middle class. He bought himself a splendid old house on the village square, he drove a bright red Porsche, his wife had a Volvo estate, he sent his two boys to public school and bought a holiday home on the south Devon coast. In the bar of the Bell, he waved a fat cigar, always slapping backs and holding forth and picking up other people’s bills. He was Mr Magnanimous, the very model of a successful country lawyer.

It was all phony. In the late 1980s, at exactly the same time as the deal-a-day culture urged him to climb higher up the slopes of success, he was engulfed by the debris of the collapsing economy, particularly by the crash of the housing market. Simply, he could not find enough business to pay for his middle class country life. He could barely afford to pay for his staff let alone for his port-and-Porsche extravagance. So he stole. And the more he stole, the more he discovered how deliciously easy it was to do so.

When he bought his splendid old house in the middle of Ramsbury, he went to the Nat West bank and took out a mortgage for £125,000. Unknown to the bank, he then went to the Cheltenham and Gloucester and did exactly the same thing. The building society had no idea that Nat West already owned their slice of the house. Then he went to the Portman and to the Woolwich and repeated the exercise. All he had to do to keep them all ignorant was to fail to file details of the loans with the Land Registry. Net profit: £370,000. When he moved into his swish new offices, he did the same thing – took a legitimate loan from Nat West and doubled up with a bogus one from the Portman. Net profit: another £114,750.

The only flaw in the fraud was that he had to pay a small fortune in interest each month to all of the building societies. He couldn’t afford it. So, he stole some more. And he still couldn’t afford to pay for his image, so he stole yet more. It was not difficult: he simply took money from his client account and spent it for himself. Money for mortgages, the proceeds of wills, deposits on houses, even £10-a-month insurance premiums – all the cash with which he had been trusted by his friends and neighbours became a personal piggy bank. It also became a game of nightmarish juggling as he concealed one theft by committing a second, and then stole again to conceal the last. Illicit debts chased each other through the accounts.

For months, he managed to control the chaos. He handled all the office books himself and left his partners in the dark. He came in early and grabbed the post before anyone else could see the threatening letters from building societies. And he carried on spending – anything to keep up appearances. On several occasions, he helped clients who were having trouble getting mortgages by setting up phony loans for them without their knowledge so that they would respect him as a lawyer and like him as a friend. It could not last. In October 1991, he went on holiday to Spain and the entire fantasy collapsed.

There are those who believe that he knew it was all over, that he deliberately turned his back to allow his fraud to be discovered. But David Read cannot have predicted the bitter outcome of exposure.

When he went on holiday, he left his day-to-day affairs in the hands of an old friend, Michael Sibley, a quiet, shy Christian, aged 42, who lived with his parents on the outskirts of Swindon. Sibley had been at school with David Read and had been proud to remain his friend as he soared towards prosperity. When he needed work in the winter of 1988, he mentioned it to Read who slapped him on the back and hired him as his office manager. Sibley was closer to Read than anyone else in the office. He signed cheques for him. Loyally, he accepted Read’s excuses for the constant shuffling of clients’ money. But within days of Read’s departure on holiday, he was confronted with the truth.

A cheque from the law firm bounced. One of Read’s partners called the bank to complain. There was supposed to be £700,000 in the client account. Why should the cheque bounce? The bank had bad news: the account was empty. Every single penny of their clients’ funds had gone. The partners called in the Law Society, who spent several days examining the books and then called in the police from Marlborough. Michael Sibley went home in tears. He told his parents he had done something terrible, he had signed away clients’ money on David Read’s instructions, and now he had been suspended from work and he was afraid he would go to prison.

A few days later – on the evening of November 5 1991 – villagers in Aldbourne, a few miles from Ramsbury, noticed a fire blazing in a farmer’s field. At first, they assumed it must be a fireworks party but then they realised it was something more serious and they called the fire brigade, who went to the field and found flames pouring out of a parked car and, when they had doused them, they discovered on the back seat the burned remains of Michael Sibley. A few days later, David Read returned to Ramsbury and confessed everything to the police. By the time he had finished, detectives were looking at £1.6 million of fraud.

In the years since he had left Phelps and Lawrence, Read had had little to do with the man who ousted him, the garrulous David Duff. But now, five years later, their paths crossed again. For, left behind to rule the roost in Rambsury, Duff had been playing exactly the same games and with even more lucrative results.

First Duff had soared. He became senior partner of Phelps and Lawrence, made easy money out of the housing boom, constantly dreamed of new money-spinning schemes – an off-licence, a fish shop, a record company, a flying club – and got just about nowhere with any of them until, in the summer of 1987, he astonished everyone who knew him by talking his way into an £800,000 deal to take over Hibernian football club, the Edinburgh team which he had followed as a boy. He persuaded a financier in Monaco to put up the money and appointed himself chairman of the board.

Now, he lived the life of his dreams – three new homes in Edinburgh, chauffeur driven Mercedes (with HIBS 1 on the number plate), a club salary of £62,000 a year, constant commuting between London and Scotland, holding forth at press conferences, flying around the world with the team, pumping hands with the rich and famous. He used to drink champagne in a pub in Southampton with a group of other wealthy professionals; they called themselves the Bollinger Boys. But David Duff’s life as a sporting baron was all just as phony as David Read’s life as a legal benefector, and just as crooked.

Police in Hampshire stumbled across Duff’s name in the autumn of 1990 as they investigated reports of another fraud in their area. They spent months trying to unravel the empire he had built from Ramsbury and finally concluded that he had abused his position as a lawyer to commit frauds totalling £5.5 million. Like David Read, he had treated local building societies as one bloated cash cow, ready to pour money down his throat every time he squeezed it. His lies were more inventive than Read’s. Apart from borrowing more than £1.5 million in his own name, he also borrowed £975,000 in the names of his staff and a further £1.1 million by stealing loans that he was supposed to be holding temporarily for clients.

At one point, he had so many mortgages that it was costing him £30,000 a month in interest to keep them all afloat. He could not afford that, so he stole his clients’ money. A woman friend whose husband died gave him a power of attorney to deal with the sale of her house while she went abroad; he took the money. He owed money to a bank, whose manager became so fed up with Duff’s stalling that he personally went to his office to get a cheque to pay off his overdraft. To cover it, Duff had to steal the proceeds from the sale of a house for a client whose divorce he was handling.

By the time the police started looking at Duff, his empire was already collapsing. His adventures as chairman of Hibs had ended in disarray when fans discovered that he had run up debts of £6 million in only three years and that apart from living the life of a credit-card junkie at the club’s expense, he had spent a small fortune of the club’s scarce funds on buying an ailing hotel chain in the west of England from his backer in Monaco. He was forced to resign.

This summer, both men have faced separate trials at Winchester Crown Court, and the honest citizens of Ramsbury and the old retainers of Phelps and Lawrence have beaten a path to the witness box to confess sadly how they were conned. David Read pleaded guilty and was jailed for three years. David Duff denied everything, was convicted and escaped with only two years in jail.

They have lost everything. David Read’s wife has disowned him, and his old partners have torn his brass name plate off the wall outside his office. David Duff is penniless and surrounded by creditors. Just like John Lawrence and Michael Swift Peacock before them, they have been crushed by the system in which they invested all their dreams.

Soon after their fall, an apparently successful businessman who had moved into Ramsbury with a loud splash of spending on his sumptuous home, disappeared in the middle of the night with a furniture van stuffed with his most precious possessions. Since then, local police have been trying to pacify the queue of debt collectors trying to find him.

In Ramsbury now, there are many who would prefer not to talk about the village villains, there are a few who admit that they would like to wring their bloody necks, and even a few who still insist that they were good men after all, Ramsbury men, English men, the sort you know you can trust.


Sidebar story

The Law Society says that if solicitors steal from their clients, the society will cover the loss themselves. Mollie Palmer does not believe them.

In March 1991, seven months before he was exposed as a fraud, David Read arranged a £150,000 mortgage for Mrs Palmer and her husband, Tony, on their home in north Wiltshire. The Palmers, who were nearing retirement, planned to put £50,000 of the money into a high-interest account as a safety net and use the rest to pay off a £100,000 overdraft at the bank. David Read handled all the paperwork and organised the payment of interest and of premiums on the life insurance which they took out to cover the mortgage.

Something went wrong. The mortgage was granted but, for some reason, the overdraft at the bank was not paid off. The Palmers called David Read and he told them the bank were just being slow. Weeks later, the overdraft was still there, still growing deeper as the bank added more interest. The Palmers started to make more calls to David Read and he always had an answer: a last-minute query from the bank; the overdraft was paid off, but the computer hadn’t registered it; there was really nothing to worry about. The Palmers did their best not to be concerned until one Saturday in June, when they received a letter from the bank threatening that if they did not clear their overdraft immediately, they would lose their home.

Mrs Palmer called David Read. “He came rushing round and he assured me that it was the bank’s fault and it was all a mistake. When I said it didn’t look as though he had done his work properly at all, he got angry with me.” Ten days later, the overdraft was paid off. Then in October, it reappeared again. A flurry of anxious phone calls from Tony Palmer had failed to solve the mystery when, at the end of the month, the Palmers discovered that David Read was suspected of fraud and they finally realised what had happened to their mortgage. They were beside themselves with anxiety. They were told the Law Society would help them. But nothing happened, and months passed.

In April 1992, Mollie Palmer wrote a frantic letter, begging the Law Society to help them. “We have just about had enough,” she told them. “Our health is suffering due to the continual worry. We are both on the verge of nervous breakdowns. We know nothing. Where is all our money? Why can’t we have it back?” Mrs Palmer explained that they were having to pay another lawyer to help them recover their money and they needed urgent help. “Hoping, praying and begging that you can HELP us to speed up the process of sorting out our affairs,” she signed the letter and sent it off.

Three weeks later, she received a reply from the Law Society’s Solicitors Complaints Bureau. This gave her a reference number and told her that a file had been opened on her case. “This file has been passed to an investigation officer and a reply will be sent to you as soon as possible.” Mrs Palmer never heard another word.

By June, Tony Palmer was so sick with worry that he went to a doctor who told him he had angina and advised him to lose weight and avoid stress. Mr Palmer did lose weight but the twin burdens of the overdraft and the mortgage continued to nag at him. One night just before Christmas, he complained that he felt ill. Mrs Palmer wanted to call the doctor, but he said he was all right really, just tired. A few minutes after climbing into bed, he stopped breathing and when the doctor arrived, he was declared dead. He was buried on Christmas Eve.

The Law Society eventually paid off the Mrs Palmer’s overdraft but by that time the problems bequeathed to her by her fraudulent lawyer had become a great deal worse. She discovered that David Read had never paid the premiums for the life insurance policy that was supposed to cover their mortgage. Her husband had died – and there was no way of paying off the £150,000 mortgage. She has it still. She is still waiting to hear whether the Law Society will help her with it.

“If I could just be allowed to grieve, I know I could cope all right. I miss him, obviously, but I know I could cope. But I can’t while all this is hanging over me. I can’t prove it but my gut feeling is that without any shadow of doubt he died several years before his time because of all the stress. Neither of us knew which way to turn when it all happened and Tony kept saying ‘Come on, love, at least we’ve got each other’. We haven’t even got that now.”