The Brussels Criminal Court has sentenced a Swedish businessman and a former Brussels lawyer to prison for a multi-million real estate fraud.
Lars-Erik Magnusson, a well known real estate investor in Sweden, along with Eline M., a 20-year veteran lawyer including 11 years at the law firm Simmons & Simmons, were handed their respective sentences last Friday by the Brussels Criminal Court.
Magnusson got a suspended prison term of four years coupled with a fine of €3.2 million, while Eline M. was slapped with a two-year suspended term and a fine of €1.6 million. The charges they faced concern money laundering, tax fraud, and abusing company assets.
Seizures of around €775 million were announced by the court, while bankruptcy trustee Charles de la Vallée Poussin is expected to receive €9.15 million, along with compensatory interest accruing from 2004, according to L'Echo.
The financial crime stems from the 2004 sale of the Bastion Tower, a renowned Brussels building at the Porte de Namur, for €117 million to a German company, netting over €25 million capital gain. Following the transaction, the management company of the building, SA Bastion, was also sold to Magnusson for €4.5 million.
Siphoned off to shell companies
Upon acquisition, SA Bastion had about ten million euros intended for paying the Belgian tax authorities on the capital gain they made from the sale of the Bastion Tower. These funds were instead redirected via dividends to several of Magnusson’s shell companies under the guidance of lawyer Eline M.
After years of non-investment and non-submission of annual accounts, a misappropriation of €10.5 million harming SA Bastion was reported to the Brussels public prosecutor's office by the tax authorities in 2010.
A yacht in Mallorca
In 2013, with liabilities of €24 million, the company was declared bankrupt. Legal investigations began, culminating in searches at various locations including Magnusson's residence in Palma de Majorca. It was discovered that the siphoned money was in part funnelled into purchasing the yacht "My Way", owned by Magnusson.
The judge deemed the crimes were aided by lawyers from two leading law firms: Simmons & Simmons and DLA Piper, though they weren’t prosecuted directly.
The court determined Magnusson utilised fraudulent money of €4.5 million through shell companies to finance his yacht and properties. Eline M. willingly participated in the crimes, the court found.
An appeal against the ruling will be filed "at the start of next week", said Magnusson's lawyer, Mr André Risopoulos.
