Car-kit fraud cost Russians pounds 3.4m: Swindlers scoured breakers' yards

THREE men were found guilty yesterday of a fraud in which a Russian company was promised 100,000 British-made cars in kit form, but received only 47. These were assembled from glass fibre kits and bits of Ford Escorts scoured from British and Belgian breakers' yards.

Part of the dollars 5m ( pounds 3.4m) paid by the Russians was used to buy two once well-known British firms that subsequently collapsed, costing hundreds of jobs. They were Dormobile, the Kent-based former maker of sleeper vans which branched out into car components, for which the fraudsters paid pounds 750,000; and a Midlands kit car company owned by the 1950s speedway aces, the Rickman brothers, for which pounds 600,000 was paid.

The three told the Russians that the companies would supply the kits, and used parts from the Rickman factories to build the 47 samples.

After a 125-day case brought by the Serious Fraud Office at Portsmouth Crown Court, Alexander Mullins, Malcolm Jennings and Charles Johnson were convicted of conspiracy to defraud.

Mullins, a Southampton businessmen, was also found guilty on six out of eight other theft, forgery and false accounting charges against a Russian car firm called Autokam and a further two counts of theft from Inplatek, which imported video cassettes.

Mullins brought in Jennings, a South London garage owner, as a technical expert and Johnson, an unqualified accountant, as his financial adviser.

The SFO called witnesses from Russia, Argentina, South Africa, the Netherlands and Ireland.

Autokam was put in touch with Mullins by a Russian middleman, and in August 1990 Mullins signed an agreement to supply the first 1,000 kit cars for dollars 5m. Later he signed up for a further 100,000.

At one point he and Jennings went to Argentina where suppliers promised copied parts, but this plan was dropped - driving Mercedes Franco, the Argentine woman who arranged the deal, out of business.

The Russians became suspicious in autumn 1991. Sentence will be passed on 27 May.