Money-laundering businessman back home in Preston after being deported from US

Preston businessman David Rae is back home in Lancashire after being deported from the United States for money-laundering.

Thursday, 13th February 2020, 6:00 am
David Rae pleaded guilty to three counts involving money-laundering.

FBI agents put the 42-year-old on a flight from New Jersey just hours after a judge ordered him to be thrown out of the country for his part in a $150m healthcare swindle.

Rae, who has been in prison since he was arrested last April, had been expected to receive a jail term of up to six years after pleading guilty to two counts of international money-laundering and one of conspiracy in New Jersey and South Carolina.

But, in a surprise move, Judge Kevin McNulty, sitting in the Federal District Court in Newark, decided the 10 months he had already served was sufficient and ordered him to be deported immediately back to the UK.

Federal District Court in Newark, New Jersey where a judge deported Rae.

He now faces having to forfeit up to £1.35m of criminal proceeds from the scam after his lawyers came to a plea agreement with the court.

When the Post visited their modest bungalow in Grimsargh yesterday Rae's wife Sarah said he was "not at home."

But later he issued a short statement which said: "The case is a lot more complicated than has been reported and the sentence is indicative of that."

Rae was one of four people charged following an investigation into a plot to fraudulently cream off millions from the federal healthcare programme Medicare.

The three others, two from New Jersey and the other from New York, were alleged to have set up dozens of companies to supply unnecessary medical equipment such as ankle, knee and wrist supports, to elderly patients under the government scheme.

It was claimed Rae's role was to launder some of the proceeds using a "shell company" called Cargill Consulting Ltd with an HSBC bank account he set up in Hong Kong. A second account at ANZ Bank in New Zealand in the name of Sympatic Global Solutions was also used to process funds.

Prosecutors alleged $500,000 was paid to the Hong Kong account in the space of just three months in late 2018. The prosecution case was that the money was then "laundered" by Rae, who knew it was from a healthcare scam, with some of it invested in real estate abroad.

Rae, who is also under investigation by the Serious Fraud Office in the UK for his alleged part in a £100m investment fraud in the Cayman Islands, is believed to have returned to the UK at the weekend after being escorted onto a flight from New Jersey by federal agents.

The minutes of proceedings in the court case of United States of America vs David Rae shows he was sentenced to "time served" on two counts in New Jersey to run concurrently with one in South Carolina.

The court document, supplied by the District Attorney's Office, says that after a hearing lasting 50 minutes Judge McNulty had "ordered defendant remanded to the custody of the US Marshals Service to transfer to FBI custody to be escorted to airport and be deported."

A reporter in the US who had been following the case admitted he was "surprised" that Rae had been freed without serving more than 10 months in jail.

Under the terms of a plea agreement in December the range of sentence in the case was settled at between 57 and 71 months for defendants with no prior criminal history.

David Marchant, owner and editor of the OffshoreAlert website, said Rae had agreed to forfeit up to $1.775m (£1.35m) of criminal proceeds.

Two of his co-defendants in the case - Neil John Aaron Williamsky and Nadia Levit, both of New Jersey - have also pleaded guilty to fraud and/or money laundering and are awaiting sentence. The third, Albert Davydov from New York, denies the charges and his case is ongoing.


Here in the UK Rae has been under investigation by the Serious Fraud Office for almost six years following the collapse of a £120m investment fraud.

The SFO launched a criminal probe in 2014 into the Axiom Legal Financing Fund, but so far no charges have been brought against any of the people who ran it or benefited from it.

The Axiom Fund crashed in 2012 amid claims it had been poorly managed. Individual investors lost between £15,000 and £250,000. One told the Post he had been forced into bankruptcy.

Four solicitors from Longridge law firm Emmetts were struck off, while the practice's chief executive Rae was fined £200,000 by a Solicitors Disciplinary Tribunal.

Rae was said to have benefited to the tune of around £600,000 from the fund which raised an estimated £120m from investors to provide short-term fixed interest loans to reputable UK law firms working on "no win no fee" cases.

Many British investors were tempted to put their money into offshore bonds with the promise of a good return. They were told each legal case being financed was rigorously vetted to ensure a high chance of success in the courts.

Emmetts was said to have received 71 payments totalling almost £30m in just six months in 2010. But instead of funding cases in the courts, cash from the fund was improperly used to pay salaries, general running expenses and a property company in Dubai.

Rae, who jetted around the globe on business trips, was a director of seven companies in the UK between 2009 and 2012, six of which have since been dissolved. They included Wiseton Investments, Oaks Legal Consultancy and Cliffcot Investments.

He was also chief executive and later a director of Whistledawn Care Ltd of Blackpool which trades under the name of Northern Care and runs care homes for young people.