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Financial Disasters Of Our Time

WHENEVER YOU hear people talk about "Eighties' excesses", they usually have an image in mind of sharp-suited salesmen guzzling champagne, chomping on fat Cuban cigars, with a posh car in the garage of their luxury town house.

Roger Levitt fitted that stereotype beautifully. Levitt was a super-salesman specialising in insurance and investment products. He smoked cigars flown in from Cuba, travelled in a chauffeur-driven Bentley and lived in a multi- million pound house in North London.

Emerging from a humble background in the East End of London, Levitt became an insurance salesman and, in 1977, he set up a business called Roger Levitt Pension Consultants. In 10 years, Levitt had built it into the largest independent financial advice firm in Britain.

Levitt's high-society clients included Frederick Forsyth, the Day of the Jackal novelist, while attracting Sebastian Coe, former Olympic gold medallist and then a Tory MP, and Adam Faith, the singer and actor, to work for him. He also promoted Lennox Lewis, the boxing champion.

By late 1989, everything looked hunky-dory for Levitt, on the surface at least. Yet, as a subsequent court hearing was told, many millions of pounds, handed to Levitt for investment purposes, were allegedly being used to prop up an rotten core at the centre of his business. More than pounds 22m was used in this way.

By 1990, the financial watchdog Fimbra sent its own investigation team to inspect the firm. Liquidators who moved in found a company in debt to the tune of pounds 34m.

Levitt was arrested shortly afterwards and originally faced dozens of fraud-related charges with a potential maximum jail sentence of 10 years. He denied them all. When his trial opened in November 1993, following a lengthy investigation masterminded by the Serious Fraud Office (SFO), it was expected to last up to eight months.

Instead, within a day or so, it was suddenly announced that Levitt would after all be pleading guilty to one count of "misleading" Fimbra. In return, the SFO's prosecutor, Michael Cocks QC, announced that other outstanding charges would not after all be pursued. Levitt was sentenced to 180 hours' community service.

Amid the uproar that followed, the SFO denied doing any deal with Levitt. Two years later, the truth came out: faced with Levitt's obstinate refusal to plead guilty to any but the smallest charges, a junior counsel for the Crown met Levitt's barrister in a Southwark Crown Court lavatory and raised the subject of a deal. Three weeks later the deal was done and dusted, with both sides informing the judge of the agreement they had reached.

Despite winning his freedom, Levitt has been unable to work in the UK since. He is now in the US, where he is said to be involved in boxing promotions.

Most of his victims received compensation, although the maximum of pounds 48,000 available under the Investors Compensation Scheme meant that some, like Mr Forsyth, were left massively out of pocket. Still, if he is short of a subject for a book, there is one story of Eighties' greed that springs instantly to mind.

Nic Cicutti