Martin Jacomb

High-class fraud

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Fortune’s Spear

Martin Vander Weyer

Elliott & Thompson, pp. 352, £

You can always find a thief in financial markets. That is where the money is. Most frauds are quite dull affairs, and some are never uncovered. A few, however, are spectacular. The scale of loss, or the glamour of the perpetrator, or the failure of the ‘system’ to spot and prevent the crookery, may contribute to make a good story. One case, almost within living memory, which has all of these elements, was that of Gerard Lee Bevan.

He was born in 1869 into a highly respected City banking family. The Bevans were among the founders of Barclays and continued to be involved in the management of the bank until recently.

However, Gerard Bevan did not make the grade for the bank. Perhaps something about his personality, even then, raised doubts about whether he had the right qualities, although he had been at Eton and Cambridge and acquitted himself successfully. And he had magnetic charm. So he became a stockbroker. He joined Ellis & Co, an old firm of high repute. He was soon hugely successful and well respected until he crashed in the 1920s. Martin Vander Weyer tells us the story of his rise to riches and his fall from grace. He explains it all in a way which non-experts can understand and enjoy. It is an enthralling story well told.

Bevan’s career must be classed as a tragedy. It started full of promise. His family was rich and well established in society. He married Sophie Kenrick who also came from a rich family, Midlands industrialists related to the Chamberlains. The author paints a vivid picture of titled upper-middle-class wealth nudging towards the aristocracy.

Bevan did well for the firm’s clients. He and Sophie bought a house in Upper Grosvenor Street and had it altered for entertaining. It also housed Gerard’s growing collection of Chinese porcelain, for which he had an excellent eye.

It all looked set fair. But then he took a wrong turning. At first it may have just been women: he was a serial adulterer, treating glamorous mistresses ostentatiously. And then he began arranging artificial support for the shares he had put his clients into. But the real crunch came when he met and teamed up with one Clarence Hatry, another legend in the history of City of London fraud. Dishonesty on a grand scale took over. Hatry was a company promoter, and the boss of City Equitable, a reinsurance company of which he had complete control. Bevan was then senior partner with absolute control of Ellis & Co. Bevan’s partners, and the City Equitable directors, with distinguished names like Lord Ribblesdale, Sir Douglas Dawson and the Earl of March, did absolutely nothing to control either Bevan or Hatry, and took no steps to find out what was going on.

There was massive misuse of City Equitable’s money to support rotten investments so that innocent punters were sucked in. Bevan liked the grand life style, with gestures to match; he once left a successful evening at Monte Carlo and gave all his winnings to a man at the door.

The crash came, as always happens, when the money ran out. But the story does not end there. Bevan fled the country in disguise, with a mistress, by air from Croydon. He was eventually caught, extradited and sent to prison. He ended up, by then having long been divorced from Sophie, married to another mistress, in a pauper’s grave in Cuba.

It is exciting stuff, and the author tells it with references to Trollope’s Melmotte, and to Elderson, the crook uncovered by Soames in Galsworthy’s The Forsyte Saga, (almost contemporaneous with Bevan and Hatry). He answers the questions which come to mind as you read the story. What happened to Bevan’s collection of antiquities? Names like Mallets and Speelman come up.

The grand directors of City Equitable were sued for negligence, but got away with it because the company’s constitution exonerated directors from liability who were not guilty of ‘wilful’ misconduct. This was itself a scandal and led to the law being changed in the 1929 Companies Act. However, the book is not just for City people and lawyers. It is a rattling good yarn and leaves you wondering whether the man had a rotten core from the beginning or whether it was addiction to money and social position which seduced him into crime. It is a cautionary tale.