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H2O Networks Fibre Optic Fraudsters Sent to Prison for Total of 44 Years

Monday, February 13th, 2017 (2:58 pm) - Score 1,649
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Last week we reported on the case of four men who had been found guilty of a £160m financing fraud that involved Total Asset Finance (TAF) and H2O Networks Ltd. (here), which was one of the UK’s early FTTH/P network pioneers. The men have now been sentenced to a total of 44 years in jail.

Back in 2010 H2O was still part of the now defunct i3 Group and they had been busy trying to roll-out ultrafast FTTP/H broadband networks across several UK cities, such as Bournemouth and Dundee, albeit with limited success (contractor disputes, shoddy street works etc.). The scheme received its funding from Total Asset Finance (TAF), which itself had managed to attract a huge investment from Barclays Bank and KBC Lease (UK) Ltd.

However an investigation by the Serious Fraud Office (SFO) discovered that the company had defrauded KBC of £142 million and Barclays Asset Finance of £16.8 million. Both Stephen Dartnell and George Alexander of TAF, as well as Carl Cumiskey of H2O and Simon Mundy, who worked for KBC, were all found guilty.

The jury was told that there was “no dispute that fraud on a massive scale had occurred, but the defendants denied involvement and, in the main, blamed each other.” The court heard that Dartnell, Alexander and Cumiskey had conspired to “create, sign and sell falsely inflated or entirely false contracts” from the company H2O to business lenders.

Key to all of this was Mundy, who had been paid £881,000 by Dartnell to act as an “inside man” at KBC and approve the funding provided by KBC to TAF. The Southwark Crown Court has now sentenced all four to a total of 44 years in jail.

Judge Gledhill QC said:

“The evidence against each of you was compelling. Not one of you has accepted dishonest involvement in these offences. Of course, you have each accepted that with hindsight that fraud was committed, but have sought to exonerate yourselves. One of the least attractive aspects of the case has been the attempts of each of you to blame others, including each other, for what happened.”

The judge’s sentencing remarks are well worth a read (here).

Count and Sentence:

George Alexander – Guilty on two counts of conspiracy to commit fraud by false representation,

  • Count 1 –  8 years in prison
  • Count 2  – 4 years to run consecutively

Stephen Dartnell – Guilty on two counts of conspiracy to commit fraud by false representation, one count of conspiracy to give corrupt payments,

  • Count 1 – 10 years in prison
  • Count 2 –   5 years to run consecutively
  • Count 3 –  6 years to run concurrently to count 1

Simon Mundy – Guilty on one count of conspiracy to commit fraud by false representation and one count of conspiracy to give corrupt payments,

  • Count 1 – 7 years in prison
  • Count 2 – 6 years to run concurrently

Carl Cumiskey – Guilty on two counts of conspiracy to commit fraud majority 10-2 on both counts,

  • Count 1 – 7 years in prison
  • Count 2 – 3 years to run consecutively

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Mark Jackson
By Mark Jackson
Mark is a professional technology writer, IT consultant and computer engineer from Dorset (England), he also founded ISPreview in 1999 and enjoys analysing the latest telecoms and broadband developments. Find me on Twitter, , Facebook and Linkedin.
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6 Responses
  1. Avatar Steve Jones

    I recall debating the viability of broadband fibre down the sewers several years back. My conclusion then was it sounded fraught with problems, but others disagreed. Now it appears it was a front for fraud. Now that makes sense.

    So is this idea of fibre down sewers finally dead or is any company doing it? Google searches give many references, not just H20. However, not much indication of operational networks, and none for domestic purposes.

    • This story is about financial fraud and less a debate about the viability of using sewers which is often, albeit not always, fraught with complications; although Zayo has put a fair bit inside sewers.

    • Avatar Steve Jones

      I did eventually find some backbone networks down larger sewers, but it was the distribution to domestic properties that always seemed unlikely to me.

  2. Avatar Steve Jones

    I should add it’s quite amusing reading some of the comments on this story from ISPreview, especially those blaming Wessex Water for lack of imagination…

    http://www.thinkbroadband.com/news/4345-fibre-through-sewer-halts-in-bournemouth.html

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