A decision not to prosecute a former solicitor over alleged mortgage fraud has “surprised” police officers familiar with the case.
It emerged last week that Christopher Hales, a disgraced Edinburgh solicitor, will not stand trial after the Crown Office concluded there was an “absence of sufficient credible and reliable evidence”.
The case has attracted publicity because Hales acted for the former SNP MP Michelle Thomson in a string of property deals in 2010-11. Thomson has always vigorously denied any wrongdoing, but resigned the party whip in September 2015 when her link to Hales emerged. She remained as the independent MP for Edinburgh West until she lost her seat in last May’s general election.
A source said that the crown’s ruling regarding Hales took detectives by surprise, especially in light of the evidence against him.
In 2014, Hales admitted to a tribunal that he was guilty of professional misconduct and was struck off.
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In 13 property deals worth more than £1.3m — all of which involved Thomson — Hales failed to disclose important information to lenders that he was required to divulge under rules laid down by the Council of Mortgage Lenders.
According to the Financial Conduct Authority, such failures can be regarded as mortgage fraud and be a crime under the 2006 Fraud Act, if there is dishonesty and an intention to profit from the deception.
In July 2015, police were ordered to investigate Hales and submitted a report to the procurator fiscal in December that named four men and a woman.
Hales’s admission of professional misconduct, coupled with a pledge by former lord advocate Frank Mulholland that the crown would “do the right thing” if evidence of criminality was uncovered, had raised expectation of a trial.
“The police are very surprised that no action is being taken,” said the source. “The investigation took a long time. Banking rules were broken, so why isn’t the crown pursuing the case? It’s farcical.”
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There is speculation that prosecutors feared it might prove difficult to show that Hales acted intentionally.
One legal observer said officials may be reluctant to embark on a costly court case that could drag on for years with no guarantee of a conviction. In May, Scottish prosecutors secured convictions against Edwin and Lorraine McLaren for property fraud after the longest criminal trial in UK legal history.
It began in September 2015 and cost an estimated £7.5m. Several people also accused of involvement had their cases thrown out.
On Friday, Police Scotland refused to comment on the Hales case.
A spokesman for the crown said the procurator fiscal had received a report “concerning four men . . . and one woman . . . in relation to alleged incidents between June 16 2010 and July 26, 2011”.
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He said that after “careful consideration” it was decided “there should be no criminal proceedings at this time.”
This weekend The Sunday Times again publishes the full, unredacted report of Hales’s tribunal hearing. Read the report here.