On 2 April 2009, five defendants were sentenced at Newcastle Crown Court for their part in a multi-million pound buy-to-let fraud prosecuted by the Serious Fraud Office following a joint investigation with Northumbria Police. The investigation was the largest ever carried out by the Constabulary.

The offences related to their respective roles in a property investment fraud that was operated by the PPP group of companies under the leadership of Mr Potts until the Department of Trade and Industry’s intervention in 2003. John Potts, Peter Gosling and Natalie Laverick pleaded guilty to conspiracy to defraud in January 2009. Peter Graham and Eric Armstrong pleaded guilty to fraudulent trading.

During the period that the fraud operated, the companies are estimated to have received over £80 million of investor funds. Those willing to invest anything from £21,000 to £28,000 in the scheme were told that the flats and houses, often in run-down areas, would be refurbished, maintained and filled with tenants, providing investors with a 15% return on their investment. However, many of the 4,000 properties bought by the company in the North East, Yorkshire and Lancashire were left derelict and unoccupied.

John Potts was sentenced to 5 years’ imprisonment. Peter Gosling was sentenced to 3 years’ imprisonment. Both were disqualified from acting as directors of companies for 15 years. Natalie Laverick, who had offered to provide evidence on behalf of the Crown following her guilty plea, was sentenced to 21 months’ imprisonment suspended for a period for 2 years. Peter Graham and Eric Armstrong were both sentenced to 2 years’ imprisonment and disqualified from acting as directors of companies for 10 years.