A British judge sentenced a fake tycoon who defrauded two banks out of £769 million to seven years in jail today but said the banks bore some responsibility because of their poor checks.

Achilleas Kallakis (44) was convicted of fraud yesterday for obtaining £740 million in loans from Allied Irish Bank on false premises, in one of Britain's biggest real estate scams. He used the money to buy properties and fund a millionaire lifestyle.

Kallakis obtained another £29 million pounds to convert a ferry into a super-yacht from Bank of Scotland, now part of Lloyds also under false premises. Co-defendant Alexander Williams (44) was sentenced to five years in jail for producing forged documents to back up Kallakis's fake claims to the banks.

"The two banks, Allied Irish Banks and Bank of Scotland, have undoubtedly acted carelessly and imprudently by failing to make full enquiries before advancing the money," said judge Andrew Goymer, delivering his sentence.

"While I do not equate the position of the banks with that of a householder or car owner who forgets to secure his house or car and becomes the victim of burglary or theft, they do bear some responsibility for what happened."

The judge noted that Bank of Scotland had been warned by its lawyers about the risks of accepting a particular letter of assurances from a Swiss lawyer backing up Kallakis's application for a loan.

"It almost beggars belief that senior management chose to disregard that warning in its rush to complete the deal at all costs," he said.

"It is however quite apparent that both defendants took full advantage of the prevailing banking culture in which corners were cut and checks on applications were superficial and cursory."

Reuters