Cllr Peter Golds is Leader of the Conservative Group on Tower Hamlets Council
The last week of January saw the disgraced former Mayor of Tower Hamlets involved in two further court cases, both of which he lost. However, both show the courage and expense required by concerned citizens in securing justice against public corruption. Those seeking to stop fraud can only look on while the police service continues in its now legendary torpor in the face of ever more damning evidence of fraud and corruption within this borough.
In April 2015, after a six week landmark trial, Lutfur Rahman was disqualified from office on seven grounds of corrupt and illegal practices and discharged from public office for five years. The Court required that he pay an initial £250,000 of the petitioners’ costs with a likely bill of £500,000. He paid not a penny; instead he incurred additional fees by seeking a Judicial Review to rule as to whether the judgements on bribery, the illegal payment of canvassers, and corruption relating to spiritual influence were correct in law.
By this process he sought to reduce the amount he would have to pay for the petitioners’ legal fees and also to reduce the period of his disqualification from office. He did not contest the remaining four grounds for disqualification, in the same way that much damning evidence against him and his so called “party” was not challenged during the trial.
Shortly after the case concluded, and in a blaze of publicity, orchestrated by Ken Livingstone, George Galloway and many in the group we now know as Momentum, an appeal for funds was launched, and well known lawyers were said to be interested in taking up the charge.
Little happened afterwards, at least from these groups.
Rahman’s legal problems
However, Lutfur Rahman has a very poor record in court. Between 2011-and January 2016 no fewer than eight different Judges in a variety of different courts were extremely critical of him, as can be seen from the following examples.
Starting in March 2011, Judge Timothy King, in jailing a convicted molester of woman – an illegal mini cab driver – described a glowing character reference submitted to the Court by Mayor Rahman “as being in ignorance of the defendant’s background and personality“. Later Rahman claimed that he did not even know the offender.
In February 2014, Judge Anthony Pitts, jailed the boss of the notorious Channel S, a Rahman mouthpiece regularly censured by Ofcom, which itself had been a recipient of much council funded largesse. His crime was money laundering and the Judge released yet another glowing character reference. In this reference, Rahman had described his criminal friend in the following terms; “he has a real desire to help others”. As this man had previously been imprisoned in 2008, it could be inferred that this desire was more to help himself and his personal and political friends.
In 2014 Rahman instructed the council to launch a failed Judicial Review attempting to prevent the Government’s Best Value Inspection of the council. This cost thousands of pounds of taxpayers’ money and failed dismally. Mr Justice Kenneth Parker commenced his Judgement with the words “This is hopeless”.
He then went on to take the application apart in the most critical and damning terms.
“Where concerns have been raised that a local authority is poorly governed, poorly managed financially and may even have engaged in fraud, it stands to reason that there must be concerns as to whether such an authority has exercised its functions as economically, efficiently and effectively as could properly have been expected.”
Later that year, Justice Goss threw out an appeal, by the Rahman instructed council in equally forthright terms, agreeing with the ruling by Mr Justice Parker.
The 2015 Judgement by Commissioner Richard Mawrey QC into the corrupt Rahman administration in Tower Hamlets is widely known.
I should say, supposedly widely known. The exception appears to be New Scotland Yard where amazingly, a senior officer investigating Tower Hamlets, claimed not to have read the judgement after it was delivered and therefore public.
In August 2015, High Court judge Mr Justice Edis suggested that “Mr Rahman might be attempting to conceal his true wealth” from the petitioners who were attempting to claim their costs back and duly froze his assets, a decision that was later extended until January this year.
The Rahman property portfolio
In November 2015, Rahman declared himself bankrupt after publishing a list of names of people who had made him loans totalling some £700,000. These included his 23 year old niece (£60,000), various Tower Hamlets First councillors and some local businesses and organisations prominent in his election campaigns.
By this time interest revolved around three properties that he had purchased for the purpose of “buy to let”. Having obtained details from the land registry, I wrote to each of the three different companies which had advanced mortgages on the two properties.
This evidence showed that on the third and fourth of March 2005, Rahman applied for separate mortgages from two different companies for two different properties. He stated on his mortgage applications that one was to be used for a residence and the other as buy to let. Both were rented out. Neither mortgage lender was notified of the other application.
Initially he intended to use his own company as the solicitor for both purchases, but wisely crossed out the company name on the second mortgage engaging a completely different company. He also varied the spelling of his name.
Tower Hamlets property prices have risen enormously over the past decade and these properties were no exception.
One property, 3 Grace Street, E3, was to become the subject of the decision in January 2016. This was purchased in 2005 for £230,000 and a mortgage raised by Mortgage Express Ltd. At the same time he secured a mortgage for 30 Deal Street, E1. This second mortgage was provided by Amber Homeloans Ltd.
Lutfur Rahman conveniently declared himself bankrupt in November 2015. The Chancery Division considered an application by Ayesha Farid (Mrs Rahman) that she was solely responsible for the property at 3 Grace Street, notwithstanding that her husband, Lutfur Rahman, had applied for the mortgage in his name and was the only name on the land registry.
To this end she provided a series of threadbare witness statements and produced witnesses who claimed to have advanced her substantial sums for the deposit. The Judge says in paragraph 72 of his decision “their evidence is hopelessly vague.” He describes as “unbelievable” the evidence that unidentified persons, advanced her £13,000 “without her (Mrs Rahman) knowing where the money came from.”
The Judge, Chief Master Marsh, was withering about both Lutfur Rahman and his wife in Court. He described Mrs Rahman in the following terms:
“I found her to be a thoroughly unsatisfactory and unreliable witness.”
He also said that:
“she adjusts her evidence under pressure.”
Of Lutfur Rahman he says in reference to the mortgages for both properties:
“It was never revealed to the mortgagor who believed the property solely belonged to Mr Rahman based on the false information he provided in the mortgage application form.”
In addition the Court established through redacted bank accounts, that these properties had realised £108,254.14 in rents over eight years. There are no records for the year 2009 and 2005-8, indicating the actual rental income is higher. The rent was paid into one of Lutfur Rahman’s bank accounts.
None of this has been declared to HMRC for taxation purposes by either Mr or Mrs Rahman.
The Chancery Division of the Royal Courts of Justice has now established that perjury, tax evasion and fraud in completion of a mortgage application, has been committed by both Mr and Mrs Rahman.
I have posted a full dossier to Sir Bernard Hogan-Howe on this case, containing the full judgement and correspondence relating to the dubious mortgage applications. The question is, will the Metropolitan Police Service investigate or, as is so wearily familiar, again avoid doing anything?
The failed Judicial Review
Earlier in the same week, on January 25th, came the decision on the application for a Judicial Review, whereby Lutfur Rahman sought to overturn three of Commissioner Mawrey’s judgements and thereby reduce the period of his disqualification from office and the amount he was required to pay in costs.
The three items were, bribery, the payment of canvassers, and spiritual influence. Lord Justice Lloyd-Jones (a former chair of the Law Commission) sitting with Justice Supperstone rejected the bid to appeal against the findings of bribery and illegal payment of canvassers, finding that the challenge to Commissioner Mawrey’s judgement was “unarguable.”
They did permit a review on the findings of spiritual influence, not that the judgement was incorrect in law, but that it had not been tested for many years.
They did not reduce the period of disqualification from office or reduce the court costs.
The full Judgement is awaited but I am indebted to Francis Hoare for noting from what was said in court with regard to grants:
“The bribery findings were ground breaking and need to be considered very carefully by every local authority. If any individual holds effective control over the budget of a local authority and distributes funding with the intention of ‘procuring’ votes corruptly, they are guilty of bribery and would stand to be disqualified from public office for five years. No such findings have ever been made previously and the January 2016 judgement is a very important finding with potentially long lasting effects on public authorities.”
This clarification of grant funding by a Judge as senior as Lord Justice Lloyd-Jones should be considered in detail by all local councils and public bodies in their grant making process.
Transparency in grants by public bodies
In future public bodies must, at least, require publication as to details of applicants, the purpose of their organisation and its rules of governance.
The Lutfur Rahman policy of setting up sham “community groups” with management bodies consisting of his personally selected candidates and supporters which duly received hundreds of thousands of pounds of money must now be over.
Councillors must be able to check and question grants by their authorities to ensure that there are no other council leaders prepared to abuse the taxpayer in the way that Rahman did.
When the full written judgement by Lord Justice-Lloyd Jones and Justice Supperstone is published, every Monitoring Officer should be sent a copy and councillors should ensure that what has been stated in court is incorporated in council codes of practice and conduct.
Councillors in Tower Hamlets repeatedly sought to establish details of groups receiving funds. It should not have taken an election petition and a government imposed audit to establish that in some places money was being showered on people who had not even formally applied for grants!
Having used the Executive Mayoral model to assume over 90 per cent of the power within the Council, Rahman was able to direct the obstruction of, and indeed personal vilification of elected members seeking information to which we were entitled, regarding the management of the council and the distribution of millions of pounds of taxpayer funded grants.
In March 2014 a document written by an officer in the Rahman office, in which I was defamed stating that I had a criminal conviction, was accidentally sent to the BBC. Two years later I am still fighting to secure access to the email exchange between a now former council officer and the BBC regarding this document. The BBC have no concerns as to releasing the email. It is the council, even now, which is being obstructive.
That I know of the contents, the date of the email exchange, when the document was sent to the BBC and indeed even the colour of the paper it was printed on, still results in continued obfuscation.
The Lutfur Rahman influence appears to continue from a political grave.
The Electoral Commission
Finally, where has the Electoral Commission been in all of this? Not a word has been published relating to the election petition, let alone the most recent legal matters.
The 2015 judgement was a landmark event and yet this organisation seeks to continue, in the words of Commissioner Mawrey:
“ with a degree of optimism that Dr Pangloss would admire.”
For the best part of a decade the electoral commission have pretended that there was no problem in Tower Hamlets or worse, producing reports that were simply laughable; on one occasion praising the borough for its robust electoral services.
The extraordinary and drawn out election count of 2014, which caused international embarrassment, was excused. Ever mounting evidence of electoral corruption resulted in so called “Protocols,” abused by Tower Hamlets First and treated as a fig leaf by the commission and the MPS, in order to ignore the reality of what was before them. This is despite them being the two organisations which should be the guardians of probity.
There has been no desire by the commission to attend the council’s overview and scrutiny committee or even a convened meeting of councillors to discuss the situation. The petitioners have been ignored and the thousands of pages of witness statements appear to be forgotten by them.
Yet the petitioners and the many witnesses have been vindicated by Commissioner Mawrey and now two senior Judges in the recent failed Judicial Review.
The taxpayer gives the electoral commission £40million per year.
Why does the silence continue?