Tuesday 10 May 2011

A frog-obsessed con woman used unwitting celebrities including Princess Diana to run up massive debts with banks.

A frog-obsessed con woman used unwitting celebrities including Princess Diana to run up massive debts with banks. 

Lynda Smith, 63, gave T-shirts and sweatshirts bearing a frog logo to a string of stars - then used pictures of them to cheat high-street lenders, lovers and friends out of more than £1million. 

The sum included £460,000 in loans and overdraft facilities from high-street banks who thought Smith was running two successful businesses called Les Frogs Partnerships and Les Frogs Promotions.

Con: Lynda Smith, left, gave her Les Frogs clothes to celebrities, including Princess Diana, pictured right wearing the brand, to pull off the scam

In reality, she was using the cash to pay off personal debts and fund a luxury lifestyle that saw her mixing with celebrities and living in a £1.2m Wilmslow mansion.

Smith, who was arrested after a probe by government fraud investigators, has now been jailed for three and a half years.

She was convicted of two counts of deception and three of fraudulent trading after a five-week trial at Manchester Crown Court. 

The jury heard how the Les Frog brand started as a legitimate enterprise - before Smith began using it as a way of defrauding creditors to fund her lavish lifestyle.  


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The key 'selling point' for the business was that Princess Diana and Manchester United boss Sir Alex Ferguson were both once photographed wearing tops bearing a Les Frogs logo. 

Smith also kept letters of thanks for t-shirts and other garments on behalf of Victoria and David Beckham, and even former US president Bill Clinton. 

None of the celebrities knew she was using their good names to rip people off. 

The court was told how Smith obtained credit by lying about the standing of her business, used bank loans to pay off personal debts, and cheated a number of friends - and two romantic partners - out of cash.  

Scam: The Les Frogs clothing brand started as a legitimate enterprise - before Smith began using it as a way of defrauding creditors to fund her lavish lifestyle

Mr Justice Christopher Clarke, sentencing, told her she had 'left a trail of havoc' in her wake.

He added: 'I am wholly satisfied that these offences are so serious that only a custodial sentence can be justified. 

'You have fought this case to the bitter end and it has taken a considerable expenditure of time and resources to establish your guilt.' 

Smith was living in Rhos-on-Sea, North Wales, when she was arrested.

The frauds took place between 2003-2009. 

The court heard how her frog businesses were 'without commercial substance', despite her boasts - and some astonishing, well-meaning celebrity endorsements. 

Investigators who raided her offices discovered albums containing photographs of celebrities wearing Les Frogs clothing - as well as a letter from St James's Palace thanking Smith for baseball caps she had sent to Prince William and Prince Harry. 

Smith has also been disqualified from acting as a company director for seven years.

Her son-in-law Ian Goss, who promoted Les Frogs, was convicted of one count of fraudulent trading.

Goss, 33, of Gwynant, Colwyn Bay, was given a nine-month prison sentence, suspended for 18 months, and ordered to do 150 hours' community service.

Smith was so successful posing as a top businesswoman that she featured on a documentary about the rich and famous - eyeing up a luxury yacht. 

The programme, called That's Rich, also showed Smith at a glitzy charity event at a premiere of the Keira Knightley film Pride and Prejudice.

To friends and investors, she was every inch the company director - even if she was seen as a little eccentric. 

Her Wilmslow home was littered with dozens of soft-toy frogs and frog ornaments, as well as expensive frog-shaped jewellery.

But investigators from the Department for Business, Innovation and Skills discovered that behind her lavish spending lay a web of lies and deception. 

The judge at Manchester Crown Court accepted Smith's Les Frogs brand had enjoyed a 'considerable measure' of early success.

But from the middle of 2003, Smith embarked on a series of bids for funding from banks, in which the jury had found she acted dishonestly.

Smith had painstakingly compiled a portfolio that included celebrity endorsements and pictures of some of the world's most recognisable figures wearing her clothes. She used it to deceive people into believing that her business was thriving.

An analysis of company bank accounts showed outgoings of more than £1,080,000, with an income - excluding bank loans - of just £167,000. 

Even romantic partners found themselves out of pocket. On one occasion she fleeced a retired merchant seaman lover out of thousands of pounds investment, which produced little in return. 

When one of her firms, Les Frogs Promotions, reached its £10,000 overdraft with a bank in 2002, she never repaid it and instead passed it on to another bank. In August 2003 she obtained another overdraft of £10,000 and loans of £70,000. 

As Smith's problems spiralled, the overdraft was increased to £40,000. By 2005, the bank was demanding £150,000.  None of it was repaid. Instead, Smith went to another bank with a 'seriously misleading' business plan and secured an £80,000 overdraft that was later extended to £120,000.

Smith also borrowed £15,000 from a friend that was never repaid and obtained a loan of £40,000 from a finance company in May 2006. She later set up a business in north Wales and was given loans from two men totalling £300,000.

Another lover, a caricaturist, gave her £115,000. The jury was told at the end of the case that she had previously been jailed for 18 months for fraudulent trading in 1993.