R v John Beckett

This is an appeal against conviction and sentence. The appellant was granted leave by the single judge to appeal on four of the five grounds relied upon in his appeal against conviction. He renews his application for leave to appeal in relation to the fifth ground. His application for leave to appeal against sentence has been referred to the full court by the Registrar, and we grant leave.

On 6 August 2024, following a trial in the Crown Court at Bournemouth before His Honour Judge Jonathan Fuller KC and a jury, the appellant was convicted of two offences of fraudulent trading, contrary to section 993(1) of the Companies Act 2006 . A co-accused, Gareth Goodrum, was acquitted of two counts of encouraging or assisting an offender.

On 18 June 2025, the appellant was sentenced by the trial judge to six and a half years' imprisonment for the first offence and to a concurrent term of three years' imprisonment for the second. Ancillary matters, including disqualification from being a director, confiscation and a Serious Crime Prevention Order have yet to be determined.

" Offence of fraudulent trading

If any business of a company is carried on with intent to defraud creditors of the company or creditors of any other person, or for any fraudulent purpose, every person who is knowingly a party to the carrying on of the business in that manner commits an offence.

on conviction on indictment, to imprisonment for a term not exceeding ten years or a fine (or both);

on summary conviction —

…"

The indictment covered the period from 1 January 2017 to 19 September 2018. During that period the appellant was the sole director of two companies, NRG Installs Limited ("NRG") and The Insulate Group ("TIG"). The prosecution case against the appellant was that he was knowingly party to the carrying on of the business of these two companies for a fraudulent purpose, namely the dishonest sale of insulation and roof covering products to consumers by the use of unfair commercial practices. This was how the allegations were described in the counts, one against each company.

This was not a case in which, as often happens in offences under these statutory provisions, the complaint is that a business was carried on with the intention to defraud creditors or to defraud investors. Rather, the prosecution case was that the victims of the offending were customers of the business who were provided with the advertised services, but in a way that was dishonest and involved the use of unfair commercial practices.

The matters that had to be proved for the appellant to be guilty of these offences were therefore: (1) that any business of the companies was carried on for a fraudulent purpose; (2) that the appellant was a party to the carrying on of the business in that manner; and (3) that he did so knowingly.

The prosecution’s position at trial, as set out in its written submissions on the law, dated 22 July 2024, was that the term "fraudulent purpose" means an intention to go "beyond the bounds of what ordinary decent people engaged in business would regard as honest", or "involving, according to the notions of fair trading among commercial men, real moral blame".

The prosecution's case was that the business carried on by NRG and TIG was fundamentally dishonest, and that unfair commercial practices were deployed systematically in support of the sales of insulation and roof coating products. Accordingly, the prosecution alleged that the business was carried on for the fraudulent purpose of making dishonest sales using unfair commercial practices.

The prosecution alleged that the appellant was knowingly party to the carrying on of the business of both companies for that fraudulent purpose. The prosecution's case was that the appellant knew that the various unfair practices were being used since they were fundamental to the way in which he intended the trade to be carried on. Where he did not directly participate in them himself, they were part of the sales culture which he put in place. This persisted despite his knowledge of the relevant regulatory framework and trading standards concerns about his businesses.

It was the prosecution's case that the appellant acted dishonestly. Their position was that it was not necessary for the prosecution to prove deception or an intention to deceive, although the prosecution said that the evidence showed that deception was in fact used extensively in the course of trading by both NRG and TIG, including by the appellant himself.

It was the position of the prosecution that the unfair commercial practices used by the companies would themselves have amounted to offences under the Consumer Protection from Unfair Trading Regulations 2008 (SI 2008/1277, "the 2008 Regulations"). However, the view of the prosecution was that the offending alleged against the appellant could not adequately have been reflected in charges under the 2008 Regulations, even if such offences had not, as they were at the time of charge, been time-barred.

The regulatory offences under the 2008 Regulations must be brought within three years and attract maximum sentences of two years' imprisonment. Furthermore, the prosecution did not consider that it would have been appropriate to proceed under the 2008 Regulations because dishonesty is not a constituent element of the regulatory offences, and the prosecution's case alleged deliberate, flagrant, and dishonest disregard on the appellant's part for the rules of fair trading.

In their Respondent's Notice, the prosecution said that it was their view that charges under the 2008 Regulations would not therefore have reflected the full extent of the appellant's criminal culpability for the way in which his companies operated.

The activities of the two businesses were effectively identical. They sold foam loft insulation and associated products and services, using telemarketers to identify customers, sales staff to attend and close deals, and installers to supply the products. The businesses had significant turnover, with accounts showing that NRG received over £8 million, and TIG £1.2 million in the relevant period. Outgoing expenditure across both businesses amounted to approximately £3.8 million for wages and commission and £1.6 million for installation sub-contractors, with the appellant receiving over £850,000.

The prosecution case was that the companies employed a number of unfair and dishonest business practices in order to obtain custom. These practices were contrary to the 2008 Regulations. The practices included the targeting of older people; lying about potential customers' current insulation; lying about the qualities, performance and financial benefits of the products sold; pressurising customers into doing deals within 14 days to avoid the statutory cooling-off period; and employing sales staff on a commission-weighted model heavily incentivising closing deals. The prosecution said that the appellant, who was the sole director of the companies, was at the core of the business and directed these practices. The prosecution said that these business practices went well beyond the bounds of what ordinary decent people engaged in business would regard as dishonest, and therefore amounted to fraudulent trading.

Agreed evidence that the telesales team targeted older people and exploited vulnerable customers, including by making second approaches to the same customers to attempt further sales;

Evidence of the scripts used by the telesales teams that included falsehoods about the state of existing fibreglass insulation in customers' properties, in particular its likelihood to cause damp and mould; falsehoods about the financial benefits of the insulation being offered by the companies and its quality; falsehoods about government endorsement of installation; and a "sweeping" script which claimed to potential customers that owing to proximity and spare materials they could receive a time-bound discount;

Evidence of the product brochures which included false claims about the quality of the products, their impact on heating bills, and exaggerating their impact on house values;

Evidence from customers about the sales tactics involved, which included bullying customers to prevent them from consulting family members; using inducements and pressure to make deals within the 14 day statutory cooling-off period; and false representations about existing fibreglass insulation, in particular that it was dangerous, illegal, and would cause damp or mould;

Evidence that 97 per cent of TIG sales were installed within 14 days, thus avoiding the cooling-off period;

Evidence that there was no particular price framework, and that sales staff were to start at £120 per square metre but had wide discretion in order to secure a sale;

Evidence of an aggressive commission-only selling model used by NRG;

Evidence from an independent survey of a number of customers' homes that the insulation installed had little or no tangible benefit to the thermal performance of the properties, often cost substantially more than market rate, and had no impact, or even a detrimental impact on damp within roof spaces; and

Financial evidence from the companies that revealed that the mark up in respect of the goods and services provided was considerable, ranging from 157 per cent to 658 per cent.

The prosecution said that whilst not every identified unfair commercial practice was deployed in respect of every customer, these practices pervaded the companies' operations and amounted to what the prosecution characterised as a fundamentally fraudulent modus operandi .

The inference to be drawn from his role as director and, at an earlier stage, a joint signatory for NRG's bank account;

Covert recording of the appellant speaking to an undercover BBC reporter who entered employment with NRG, explaining that they showcase how bad fibreglass is;

Recordings of the appellant in conversation with sales staff falsely asserting that fibreglass absorbs moisture like a sponge, that it is no longer used in properties, and telling a customer that their product was A rated when so such rating exists;

Evidence of the appellant's use of contemptuous language towards customers;

Evidence of the appellant's use of fictitious cancellation stories to encourage a potential customer to make a deal;

Evidence that the appellant approved the use of reference to fictional "damp vouchers" and "subsidies" to explain lower prices to customers when these were simply discount inducements;

The evidence of a staff member with responsibility for compliance, Mr Harper, that while he made efforts to improve the ethics of the business, liaising with Trading Standards and revising documentation, the appellant did not always act when an unethical sales practice was identified, and the problematic practices remained;

Evidence of an awareness by the appellant of concerns on the part of law enforcement and specifically Trading Standards surrounding the companies' operation; and

In a covertly recorded conversation on 27 June 2018, the appellant asked his co-defendant to throw his incriminating mobile phone in the river.

The defence said that the prosecution evidence was selective and did not properly reflect systematic activities by the companies, or the appellant's role. Taken as a whole, the company was not trading fraudulently, and to the extent that there were problematic practices, these were not within the knowledge of the appellant.

The appellant gave evidence in his defence. He explained that he had believed the representations made in the sales scripts and the brochures regarding the technical nature of the insulation and its quality and performance; it had been provided by the manufacturer. In respect of steep discounting against initial prices, the use of terminology such as "damp vouchers" and "subsidies", and falsely claiming cancellations to motivate potential buyers, this was normal commercial puffery. He contended that the business was not fraudulent; it provided a product at a price that the homeowner could afford. He did accept that on occasion vulnerable people were sold to improperly, but this was without his knowledge. The small number of such cases was not indicative of the general nature of the business, which was legitimate.

The appellant also relied on evidence that the company employed Mr Harper to ensure compliance with good business practices. He referred to the documentary evidence of the compliance and complaint policies, and to customer references, which he asserted supported the contention that the business was operating responsibly.

" FRAUDULENT TRADING (Counts 1 and 3)

Section 993 of the Companies Act provides that

Fraudulent purpose implies an intention to behave in a way which goes beyond the bounds of what ordinary decent people engaged in business would regard as honest.

Whether a fraudulent purpose has been proved in this case is for you the jury to decide.

The offence does not require the proof of deception or an intention to deceive, though in many cases such evidence may be present.

Similarly, the offence does not require proof of unfair trading practices, but if such breaches are established, they may,

In this case there were many cancelled sales and some which

[The appellant] is charged with knowingly being a party to the carrying on of the business NRG and TIG for a fraudulent purpose, namely the dishonest sale of their insulation and roof covering products using unfair commercial practices.

First, that the business in question was carried on for a fraudulent purpose, namely making sales using dishonest misconduct; it does not have to be the sole or only purpose. There is no requirement that the business started fraudulently; it may or may not have done so. Nor is there a requirement that the whole of the business was fraudulent from the outset. If any business of the company was carried out for a fraudulent purpose, that will suffice.

Second, that the [appellant] was party to the carrying on of the business in that way (in the sense that he exercised a controlling or managing function).

Third, he did so knowingly, i.e. with knowledge of the

Fourth, he acted dishonestly.

The prosecution case is that the first defendant knowingly generated sales through his salesman both over the phone and at

Furthermore, whilst being fully aware of the consumer regulations that protected the customers' interests, whilst paying lip service to them they in fact flouted them. They used high pressure methods to bypass those consumer rights, in particular their right to a cooling off period. The defendant wanted the money there and then. The customers were, as a result, misled, deprived of their rights and many parted from their money. This conduct they say, was fraudulent.

If you were sure [the appellant] was knowingly playing a part in running the business for a fraudulent purpose and you were satisfied he was acting dishonestly then your verdicts would be guilty.

The case for [the appellant], in summary, is that the alleged

never made,

made without his knowledge,

if made, were not misrepresentations,

no consumer regulation was broken,

if broken, done so without his knowledge.

Putting it another way, although it was his business, he was neither aware of, [n]or party to, any fraudulent practices; and any involvement he had, was not dishonest.

If this was or may have been the case, then your verdicts would be not guilty.

Whether [the appellant] acted dishonestly is for you the jury to decide and before you could convict on either count you would have to be sure that he was.

Dishonesty is an ordinary English word. In order to determine whether someone acted dishonestly you first look at all the surrounding circumstances and come to a conclusion about what was the [appellant's] actual state of knowledge or belief as to the facts at the time. The focus is not on whether he believed his actions were honest, but what he knew or believed to be the factual circumstances at the time.

Having done so you must decide whether his conduct was

In deciding whether his conduct was dishonest you may take into account industry standards and what he knew about them, but they are not the test of dishonesty. The test is the standard of ordinary decent people, and you decide that."

The Route to Verdict, which the judge provided to the jury, was consistent with these legal directions.

The first ground of appeal is that the judge misdirected the jury about the meaning of "for any fraudulent purpose" in section 993(1) of the 2006 Act . The appellant submitted that the approach taken in the judge's legal directions was inconsistent with the approach that was taken by the Court of Appeal in R v Hunter and Another [2021] EWCA Crim 1785 ; [2023] QB 1 .

On behalf of the appellant, Mr Jarvis KC submitted that in order for any business of the company to be carried on for a fraudulent purpose, the jury must be sure that it was a purpose of the company that its business would be carried on by its employees and agents in such a way as to commit fraud. In this context, "fraud" means an act or omission of a type that can properly be described as fraudulent, such as a deception, in which ordinary and decent business people would consider to be dishonest. It has to be a purpose of the business of the company that some form of misconduct should take place in the course of its operations which would be dishonest by reference to that standard. It follows, he submitted, that it was important for the prosecution to identify what the misconduct relied upon was.

Mr Jarvis submitted that the judge in the present case erred because the legal directions did not identify the misconduct of which the jury would need to be sure before they could find that the business of the companies was being carried on for a fraudulent purpose. At paragraph 18 of the legal directions, the judge said that the fraudulent purpose "implies an intention to behave dishonestly", as if an intention to behave dishonestly is enough to prove fraudulent purpose, when this is not the case. Nowhere in the legal directions did the judge specify the misconduct that the jury had to be sure it was the purpose of the companies for the employees or agents to carry out; and which, if carried out in accordance with that purpose, would be dishonest. This meant that the jury might be sure that the company in question carried on business for a fraudulent purpose, if it was sure, in a general sense, that it was the purpose of the companies to behave in a way that ordinary and decent people of business would find was dishonest, even if the jury was not sure of any specific misconduct.

It was submitted that the judge should have identified for the benefit of the jury the misconduct of which they would have had to be sure before they could go on to consider whether misconduct of that type was dishonest by the standards of ordinary and decent people of business.

In legal argument, before the directions were given, the defence had suggested that the judge should tell the jury that the prosecution case was that the misconduct that lay at the heart of the prosecution case was alleged false representations made by a salesman and the appellant about the quality of the products that the company sold. This would have had the additional benefit of focusing the jury's mind on the question whether the company had been carried on for the purpose of making such false representations, rather than being made on an ad hoc basis, and also on the question whether ordinary and decent people of business would consider it dishonest for such false representations to be made.

On behalf of the prosecution, Mr Norman submitted that the appellant's argument is misconceived; that there is no authority for the assertion that misconduct is a necessary component of "fraudulent purpose", as distinct from and additional to dishonesty. All that the prosecution needed to prove in relation to this element of the offence is a purpose that is fraudulent in that it is dishonest by reference to the standards of ordinary and decent business people. Put another way, that is the misconduct of which the jury was told that it needed to be sure in order to find fraudulent purpose. The judge's directions accurately set out the law as contained in the statute and were consistent with the guidance of the Court of Appeal in Hunter .

The offence of carrying on a business for a fraudulent purpose did not incorporate, and was not subject to, the restrictions and limitations that applied to the separate and distinct common law offence of conspiracy to defraud: see [84] of the judgment. The common law tail should not be used to wag the Parliamentary dog: see [91];

The only requirement of the purpose is that it must be fraudulent: see [85];

Section 993 focuses upon the conduct of the individuals in their business dealings and is an offence focused upon a fraudulent carrying on of the business purpose: see [92];

It followed that a fraudulent purpose within the meaning of section 993 was not restricted to the limited purposes enumerated under the common law offence of conspiracy to defraud: see [92]; and

The words "fraudulent purpose" must be given their ordinary and natural meaning: see [94].

The concept of 'fraud' is well established. Dishonesty is an essential ingredient. One classic formulation of dishonesty is found in Re Patrick & Lyon [1933] 786 Ch per Maughan J at page 790: as '…involving, according to the current notions of fair trading amongst commercial men, real moral blame'. This was the formulation used by the Judge in his directions on law to the jury. Later, in [ R v Grantham ] [1984] 1 QB 675 , the Court of Appeal, in a case concerning an intent to defraud creditors, approved of a passage from the summing up in the earlier case of Welham v DPP [1961] AC 103 where the House of Lords had approved of a description of dishonest fraud as '… stepping beyond the bounds of what ordinary decent people engaged in business would regard as honest'. Many judges have, whilst seeking to encapsulate the test in understandable language, cautioned against any judicial attempt to set out a definitive, all encompassing, legal definition. …

The running of a business in a fraudulent manner will commonly involve acts of commission and omission. The deliberate concealment or suppression of true facts or information might be compelling evidence of fraud. Commissions and omissions can be two sides of the same dishonest coin. In R v Philippou 89 Cr App R 290, the Court of Appeal held that the concealment of transactions in order to maintain or renew licences issued by the Civil Aviation Authority was capable of amounting to fraud. However, whilst deception might be a prime example of fraudulent behaviour, conduct that is fraudulent might go beyond the perpetrating of deception. Deception and fraud are not synonymous.

The focus upon purpose means that the law is prophylactic. A fraudulent purpose might be proven before anyone is actually defrauded or becomes an actual victim of the fraud. In the present case if the [Crown] had charged the defendants after they had acquired the relevant bots and other software and the multiple credit cards and had set up a system for using an array of false identifies, but before the defendants had put that system into operation and used it to trick ticket vendors into selling them tickets and/or to place end consumers at risk, then the offence would still have been committed even though there was no actual fraud and no actual harm to end consumers and therefore no victims. A fraudulent purpose would still be in existence and business acts to achieve that purpose would have been carried out. Of course, evidence of implementation might afford powerful additional evidence of the fraudulent purpose, but implementation of a fraudulent purpose is not an essential ingredient of the offence.

It follows from the case law set out above that there is no requirement for the [Crown] to prove an intention to deceive. In (very) many cases that is likely to be a key ingredient of the evidence which goes to prove a fraudulent purpose; but it is not strictly necessary."

In our judgment, the legal directions given by the judge in the present case in relation to "fraudulent purpose" were impeccable. They were entirely consistent with the law as set out in Hunter and in the earlier cases. There was nothing wrong or misleading about telling the jury (at paragraph 18 of the legal directions) that "fraudulent purpose" implies an intention to behave in a way which goes beyond the bounds of what ordinary and decent people engaged in business would regard as honest. This is consistent with what the House of Lords said in Welham . There is nothing confusing or inaccurate about recognising that dishonesty is a necessary element of fraud. This is a different thing from equating fraud with deception, rather than dishonesty. Fraud can exist for this purpose without an element of deception, as the judge made clear at paragraph 20 of the legal directions.

In his oral submissions, Mr Jarvis submitted that the judge's directions wrongly gave the impression to the jury that dishonesty was synonymous with fraud. Mr Jarvis said that this was wrong because dishonesty is a necessary, but not a sufficient, ingredient of fraud.

We do not accept that this is a fair criticism of the legal directions. The judge's direction at paragraph 18, as we have said, mirrors the guidance on "fraudulent purpose" that was given by this court in Hunter at [118], and before that by the House of Lords in Welham . We do not in this judgment have to deal with theoretical questions about whether there can be cases in which a purpose is dishonest but not fraudulent.

The judge made clear to the jury that the central issue was whether the business was acting fraudulently in the sense that it was acting beyond the bounds of what ordinary and decent people engaged in business regarded as honest. He told the jury, correctly, that this was not the same as an allegation of unfair trading practices, but that if such practices were proved they could assist the jury in deciding whether the company was acting fraudulently and whether that was its purpose.

The judge also made clear that the unfair trading practices were not the sole determinants and that whether proof of such practices was proof of fraud was a matter for the jury to decide.

The judge told the jury, again correctly, that a fraudulent purpose can exist even if the objective is not achieved in that sales were not obtained.

We do not accept the suggestion advanced on behalf of the appellant that there is an additional requirement for this offence, beyond "fraudulent purpose", of proof of some form of specific misconduct. This is not what the statute says. Misconduct may be evidence of fraudulent purpose, but is not itself an ingredient of the offence of fraudulent trading. Furthermore, we do not accept that it was incumbent on the judge in his legal directions to identify the specific acts of misconduct of which the jury must be sure in order to be sure of the fraudulent purpose. What is required is that the jury is sure that the business, or a part of it, is carried on for a fraudulent purpose.

As the Respondent's Notice put it, it is a matter of common sense that "fraudulent purpose" requires an intention to engage in conduct of some sort. In a case such as the present, the jury must consider the entirety of the evidence of the way that the business was planned, organised and operated. A fraudulent purpose may be proved from a patchwork of acts and omissions, or planed acts and omissions, including acts which could be described as misconduct, which, taken together, prove the fraudulent purpose. It would be impractical and unhelpful for a judge to be required in their legal directions to enumerate each and every aspect of the evidence that is relied upon by the prosecution in this regard.

In his summing up of the facts, the judge reminded the jury comprehensively of the evidence that might be relevant to the jury's consideration of fraudulent purpose. We have summarised the main aspects of this earlier in this judgment. Moreover, in the course of the legal directions, the judge did refer to some of the key alleged acts of misconduct which were or could be evidence of a fraudulent purpose. These were: unfair trading purposes (at paragraph 21 of the legal directions); knowingly generating sales through giving false and misleading statements to customers (at paragraph 25); flouting customer regulations that protected the consumer's interests; and using high pressure methods to bypass consumer rights, especially by persuading customers to forego the 14 statutory cooling-off period (at paragraph 26). At paragraph 24(i) the judge summarised the allegations of fraudulent purpose as being that the businesses were making sales using dishonest misconduct. We should mention in passing that there was nothing wrong or inconsistent in using the phrase "dishonest misconduct" in this paragraph. It just meant the same as "dishonestly".

If anything, this is a more specific identification of misconduct in the legal directions than the defence had asked the judge to provide. But even if the judge had not given any particulars of misconduct in the legal directions, he would not have fallen into error.

In Hunter , at [118], this court said that most judges have, whilst seeking to encapsulate the test in understandable language, cautioned against any judicial attempt to set out a definitive, all-encompassing legal definition of "fraud" or "fraudulent purpose". It would not, as appears to be suggested on behalf of the appellant, have been appropriate for the judge to enumerate particular alleged types of conduct and then to tell the jury whether such conduct, if proved, would or would not amount to fraudulent trading. This would be to trespass on the role of the jury.

The judge reminded the jury, in his summing up of the facts, of the various acts or omissions which the prosecution said was evidence of fraudulent purpose, and he also reminded the jury of the defence case in relation to them.

Finally on this ground, it is clear that the appellant knew the case that he had to meet.

The 2008 Regulations were placed before the jury by agreement between prosecution and defence. It must follow that both parties accepted that they were relevant. However, as we have said, the appellant was not charged with any offences under the Regulations, and indeed the timing for prosecutions under the Regulations had passed.

Nevertheless, there is an obvious potential overlap between offences under the Regulations and the offence of fraudulent trading. The 2008 Regulations, which came into force on 26 May 2008, represented the implementation into domestic law of the European Unfair Commercial Practice Directive (Directive 2005/29/EC). They replaced parts of the Trades Descriptions Act 1968 . They put in place a comprehensive framework to deal with sharp practices and rogue traders. Dishonesty is not an element of any of the offences under the Regulations. Nor do the Regulations state that where prohibited conduct occurs, such conduct will be dishonest. Some of the offences relate to harassment, coercion or aggressive practices.

Ground 2 of the appeal focuses on paragraph 21 of the legal directions which addressed the relevance of breaches of the 2008 Regulations.

The judge was presented with a difficult choice as to how to deal with the 2008 Regulations in his legal directions. On the one hand, the appellant was not charged with any offences under the Regulations. On the other hand, the parties had agreed that the Regulations should be placed before the jury, together with the relevant trading standards, as set out in the Regulations, with the regulatory background against which the companies' business activities took place. The jury would, in any event, have been aware that the law laid down trading standards for businesses. In those circumstances, the judge had to say something about them. In our judgment, he was entitled to take the approach that he took. He made clear, first, that the offences for which the appellant was being tried did not require proof of unfair trading practices. The reference to unfair trading practices is plainly a reference to breaches of the 2008 Regulations, not least because the word "breaches" is used in the next sentence.

The judge then said that if breaches were established, they may assist in helping the jury to decide if it was sure that the company had been acting beyond the bounds of what ordinary and decent people engaged in business would regard as honest. This was an appropriate observation to make. The jury was entitled to take the view that ordinary and decent people engaged in business would not consider it to be honest to act in a way that breached the Regulations, especially as there was evidence before the jury that the appellant had engaged a compliance officer, but had not paid heed to his advice.

It is true that not all offences under the 2008 Regulations require an element of dishonesty, but dishonesty will often be involved, and the jury could be in no doubt that the case against the appellant was that his businesses were being conducted in a dishonest manner and so that the relevant breaches of the 2008 Act were such that they involved dishonesty.

Finally, the judge emphasised to the jury that whether or not any conclusions about breaches of the 2008 Regulations were relevant to the finding of the offence with which the appellant was charged was a matter for the jury.

The appellant says that paragraph 21 was a misdirection in three respects. First, Mr Jarvis KC said that the judge failed to direct the jury that before any breaches of the Regulations can be taken into account by the jury, it would be necessary for the jury to be sure that the breaches were made out.

We do not accept this submission. The judge had given the jury the standard direction on burden and standard of proof at paragraphs 11 to 13 of the legal directions. Against that background it was clear that the word "established" was shorthand for "proved".

Second, it was submitted that the judge did not make clear whether by the word "breaches" he meant an act in contravention of the prohibition in the Regulations, or an act in contravention of the prohibitions in the Regulations that would have amounted to a criminal offence under the Regulations. Mr Jarvis said that the distinction was important, because a person may have contravened the 2008 Regulations and yet not have committed a criminal offence if the breach was inadvertent, or if they had employed due diligence.

Again, we do not accept this submission. It is fanciful to think that the jury might have taken breaches of the 2008 Regulations into account against the appellant for the purposes of the offence of fraudulent trading in circumstances in which the jury was not sure that the breaches were not inadvertent, or had not taken place despite the use of due diligence.

The third point made on behalf of the appellant in relation to ground 2 is that it is not obvious that the 2008 Regulations themselves have any role to play in informing how the ordinary and decent person of business would approach the question of whether carrying on business for a particular purpose was dishonest. There is a risk that the jury might have concluded that where employees of a company act contrary to a prohibition in the Regulations, then regardless of the reasons for doing so, such conduct is dishonest. It was submitted that the judge's directions conflated two very different regimes – the 2008 Regulations and the offence of fraudulent trading.

Once again, we must reject this submission. As we have said, the judge had no alternative but to say something about the 2008 Regulations, and his directions, when taken as a whole, placed the Regulations in their proper context and made clear that what the jury must focus on are the ingredients of the offences of fraudulent trading with which the appellant was charged.

"I have given you the legal directions and what part the regulations play. They are there for your information and to afford some insight about how the lay expects business people to conduct their affairs. And, as I say or suggest, they do not perhaps hold any surprises for anyone, especially not those involved in business.

"Now my final remarks are these and they really just pull together some of the issues and they are here for you to focus. A business, as I have already explained, does not have to be fraudulent from the outset. The law does not require that all the business of the company is carried out for a fraudulent purpose. It may be a large part of the business. It may be the whole of it, it may be a small part of the business. It may be achieved, the fraudulent purpose, in any number of ways. There may be lies or practices to deceive or pressurise. Whether they may coincidentally offend the trading regulations is not the focus of your attention.

These comments again made clear to the jury that their focus must be on the offences of fraudulent trading, not on the question whether there had been breaches of the 2008 Regulations.

This ground criticises the answer given by the judge to a question from the jury. The appellant does not criticise the way that knowledge was dealt with in the legal directions themselves. At paragraph 24(iii) of the directions, the judge directed the jury that the prosecution had to prove that the appellant was knowingly party to the carrying on of the businesses or part of the businesses for a fraudulent purpose, so that he had knowledge of the fraudulent purpose of the business. At paragraph 23, the directions state that the fraudulent purpose was the dishonest sale of insulation and roof covering products, using unfair commercial practices.

"In terms of legal directions, when each offence requires for the

"Thirdly, you have to decide whether [the appellant] acted knowingly. In other words, with knowledge of the fraudulent purpose, namely the sale of products using unfair commercial practices. So that is the third element; and negligence, which is raised by the questioner, is not the same as knowledge. You have to address his state of mind, not how he may have arrived at it.

The starting point for consideration of this ground is, as the grounds of appeal put it, that the appellant says that ground 3 follows on from ground 1. The appellant contends that the judge failed to direct the jury that it had to be sure that the appellant knew that the business of the companies was being carried out for some specific form of misconduct.

We have already said that the judge was not required to specify a particular form of misconduct as part of his legal directions. Accordingly, this aspect of ground 3 also fails.

The appellant also says that the answer to the jury question was a misdirection, because the judge directed the jury that they had to decide whether the appellant acted with knowledge of the fraudulent purpose, namely the sale of products using unfair commercial practices. The appellant says that this was a misdirection because it was never suggested to the jury by the judge that it had to be sure that the fraudulent purpose was the use of unfair commercial practices.

We do not accept this submission. The words of the indictment themselves say that the fraudulent purpose is "namely the dishonest sale of insulation and roof covering products to consumers using unfair commercial practices". The phrase "unfair commercial practices" is a perfectly appropriate general description for the business practices in which it was alleged that the appellant knew that the businesses were engaged. If it is being suggested that the judge misdirected the jury because he did not say that it was not necessary that the appellant subjectively understood or believed his actions to be dishonest, this is misconceived. It was made clear by the Supreme Court in Ivey v Genting Casinos [2017] UKSC 67 ; [2018] AC 391 at [74] that once a defendant's actual state of mind as to knowledge or belief as to the facts this established, the question whether the conduct was honest or dishonest is to be determined by the fact-finder by applying the objective standards of ordinary decent people. There was no requirement that the defendant must appreciate that what he has done is by those standards dishonest.

We should add that there is nothing in the legal directions to suggest that the judge conflated "fraudulent purpose" with "knowledge".

This is the ground for which leave was not granted by the single judge. Accordingly, the appellant needs leave from the full court to argue it.

"In deciding whether his conduct was dishonest, you may take into account industry standards and what he knew about them, but they are not the test of dishonesty. The test is the standard of ordinary decent people …."

The appellant makes two points. The first is that by this form of words – and in particular by reason of the reference to "industry standards" – the jury may have understood the first part of this direction to constitute permission for them to imbue the ordinary decent person with knowledge of the Regulations in order to decide whether the appellant was himself dishonest.

This point is not arguable. This is based on a gloss of the words in paragraph 34 of the legal directions. The words do not, even arguably, say or imply what the appellant says they do.

The second point is that the judge misdirected the jury by directing them that they should take account not only of the appellant's knowledge and belief of the facts, which the appellant accepts is relevant as regards dishonesty, but also his knowledge and belief as regards whether the 2008 Regulations were breached, which the appellant says is not a relevant consideration.

Once again, this is not arguable. The jury was correctly directed that it was entitled to take account of the appellant's knowledge of industry standards. It was not directed that it should take account of the appellant's knowledge or belief as regards whether there were breaches of the 2008 Regulations.

In any event, as the Respondent's Notice points out, the industry standards are informed by the 2008 Regulations. It is a relevant consideration when considering dishonesty whether the appellant knew or believed that the businesses were operating in a way which contravened legislation designed to catch sharp practices and rogue traders.

We do not grant leave to argue ground 4.

"… if the defendants knew what they were doing but we feel they may not have known their actions were fraudulent, has the mens rea been met?"

"Finally, the expression 'ignorance of the law' was used. Well ignorance of the law cannot provide a defence. If the ingredients of the offence are proved, then a defendant is guilty and there I shall leave it."

The criticism on the part of the appellant was that the judge should simply have replied "No". Also, it was submitted that, by referring to ignorance of the law being no defence, the judge may well have left the jury with the impression that the appellant could be guilty of the offence even if he harboured a doubt as to whether the business of the companies was being carried out for a fraudulent purpose.

We do not accept that this is a fair criticism of the judge. Whilst perhaps he could simply have answered "No" to this part of the jury's question, it was made more complicated by the fact that this was only part of a set of questions that was asked by the jury. The judge's answer was a correct answer to the specific question that was posed, and there was no risk that it might have been interpreted by the jury to contradict the clear and correct directions that the judge had given in his legal directions.

For these reasons we refuse leave on ground 4, and we dismiss the appeal on the other grounds.

The sentencing judge was, of course, the trial judge. In his sentencing remarks, the judge described the modus operandi of the businesses in the terms that we have described. He said that the businesses were designed to achieve rapid returns through high pressure sales tactics, deception, misrepresentation, and false claims. The judge described the practices of the two companies as being manifestly dishonest. Elderly people and those with mental frailties were singled out.

In 90 per cent of cases customers were persuaded to waive their rights to a statutory cooling-off period and the installations were carried out as quickly as possible to prevent customers from changing their minds. Customers were subjected to bullying tactics, especially if they were thinking of changing their minds.

The period of the fraud was over a year and a half – from January 2017 to September 2018. NRG was fraudulent from the outset, or very nearly thereafter. NRG turned over £8.9 million in the relevant period; and TIG over £1.2 million. The appellant's personal gain from the business was £850,000. There were hundreds of customers.

13 victims gave evidence. Their total loss was only £150,000. However, the human cost was enormous. The victims spoke of being left feeling frightened, intimidated, vulnerable, ashamed and violated. Their family members were also badly affected. Some victims no longer felt safe in their own homes; and some found their homes to be difficult to sell, or worth less than they would have been, meaning that there was less money left over for their care in their final years.

The judge said that the appellant was at the heart of the fraudulent trading. He was "detection averse". The judge decided, somewhat generously perhaps, that he should sentence on the basis that only part of the business was being carried on for fraudulent purposes, namely that part that involved the 30 witnesses who gave evidence at trial. He took this view because that was the only part of the businesses in respect of which there was direct evidence of a fraudulent purpose. This is perhaps generous because the judge might have drawn an inference on the evidence at trial that the fraudulent purpose went much wider. Indeed, he noted that a larger number than the 30 had been duped but had managed to extricate themselves before the work was carried out.

However, this court should, and does, approach the appeal against sentence on the same basis as regards the scope of the fraudulent purpose, as was adopted by the judge.

The judge noted that there are no sentencing guidelines for fraudulent trading. He took account of the general sentencing guidelines and of the fraud guideline as an analogous guideline. He noted that the offence for fraudulent trading covers a wide range of conduct, some of which may be less culpable than fraud or theft. But there may be cases in which the nature of the conduct is such that it is appropriate to compare it with the particular sentencing range within the fraud or theft guidelines.

Mr Jarvis KC, who appeared for the appellant at the sentencing hearing, submitted that no comparison should be made with the fraud guideline. He pointed out that the appellant could have been charged with conspiracy to defraud, but was not.

The judge rejected this submission. He emphasised that he did not directly make use of the fraud guideline, but rather had regard to it as a guideline which was comparable in some respects with the offending in this case.

The same maximum sentence applies to conspiracy to defraud as to fraudulent trading, namely ten years' imprisonment. The judge also noted that the maximum sentence for unfair trading, contrary to the 2008 Regulations is two years' imprisonment, but he said that if the appellant had been sentenced for that offence each of the victims' cases would have been a different count, and the court might well have imposed consecutive sentences of 12 months' imprisonment for each.

We interpose to say that, given the number of victims and the similarity of the offending, if these had been charged as unfair trading cases, the sentence would then have been adjusted downwards for totality.

The judge then considered the case of R v Mackey [2012] EWCA Crim 2205 , in which this court set out sentencing considerations for the offence of fraudulent trading, which included the amount of the fraud, the way in which it was carried out, the period over which it was carried out, the defendant's position in the company, any effect on public confidence in the integrity of commercial life, and the personal benefit to the offender.

The judge in the case with which we are concerned then went on to deal with specific relevant factors. He used the structure and the language of the fraud guideline, while he made it clear that he understood that this was not a fraud case.

The appellant played the lead role in a well organised and sophisticated fraud which, focusing only upon the 30 victims who were witnesses, deployed up to 12 salesmen. There was significant planning, which was done by the appellant. The appellant weaponised the sales staff to obtain what they could get away with from the victims. He took an active part in the day-to-day running of the fraudulent practices. He and his salesmen used secret codes to indicate how profitable the job was in order to work out a bogus discount;

The victims were targeted based upon their aged, their presumed savings and their vulnerability;

The appellant well knew that this would lead to unfair commercial practices and he was warned about this by Trading Standards in January 2018. The appellant showed a widespread contemptuous disregard for his vulnerable victims, calling them "fraggles";

At the time of sentencing the appellant was aged 41. In 2011 he had received a sentence of ten years' imprisonment for conspiracy to supply cocaine. This was not his first substantial sentence for a drugs offence. In 2015 the appellant was recalled to prison for an offence of money laundering, for which he received a further consecutive term of 12 months' imprisonment. Thus, the appellant was on licence throughout the indictment period; and

There was little by way of remorse. The appellant blamed others.

The 30 victims who were witnesses suffered direct financial losses totalling £150,000;

The victims were not rich people;

They had further consequential and remedial losses;

They suffered a great deal of psychological harm; and those who were already mentally frail suffered a particularly high impact; and

Practices such as this have a significant impact on public confidence in the integrity of commercial life, which justifies an element of deterrence in sentencing.

The judge rejected the submission advanced on behalf of the appellant that when assessing loss he should take account of the fact that products were installed. The judge pointed out that the victims were misled and pressurised into purchasing a product that they would not otherwise have purchased.

At the time of sentencing, the appellant was working and supporting his immediate and wider family. His family spoke highly of him;

There were no accusations of unfair practices in the appellant's business life since these events;

The appellant has some medical issues; and

There was some delay in the proceedings, but the judge noted that there was a great deal of material to examine and issues such as this take time to come to court. He made little or no allowance for the delay.

The judge sentenced the appellant on the basis that the sentence for count 1 (relating to NRG) would reflect the entirety of the offending. As we have said, the sentence was six and a half years' imprisonment.

On behalf of the appellant, Mr Jarvis KC submitted that the sentence was manifestly excessive. He relied upon a comparison with the case of Mackey , in which the appellant had been sentenced to a term of 18 months' imprisonment for fraudulent trading, which consisted of running a letting agency in which she collected deposits and rents totalling £60,000 from tenants, but she did not pass the money on to landlords. The fraudulent trading in that case was sophisticated and lasted some five months. Mr Jarvis KC pointed out that the Court of Appeal had observed that a sentence of 18 months' custody had been at the very top of the sentencing range.

Mr Jarvis KC relied upon some observations about sentencing for fraudulent trading that were made at [16] of the judgment in Mackey . We have already referred to the relevant considerations that were identified by the Court of Appeal in Mackey when we summarised the sentencing judge's reasoning in this case. In addition, the Court of Appeal in Mackey said that the offence of fraudulent trading covers a wide spectrum of offences. The court also said in broad terms that perhaps more aptly at the bottom end of the scale it is right to say that a charge of fraudulent trading, which results in a substantial total deficiency to creditors, is less seriously regarded than a specific charge of theft or fraud in an equivalent amount.

We were also referred to two other cases, R v Ali [2019] EWCA Crim 1263 and R v Rattu [2021] EWCA Crim 757 ; [2021] 1 Cr App R(S) 2, in which the defendants were sentenced to 28 months' imprisonment for fraudulent trading, and in which this court dismissed appeals against sentence.

Mr Jarvis KC pointed out that the sentence imposed on the appellant was more than four times the sentence imposed in Mackey and nearly three times the sentences imposed in Ali and Rattu.

Mr Jarvis KC submitted that the judge did not explain the basis for arriving at a sentence of six and a half years' imprisonment. He pointed out that this was not a case in which the offender had taken money from the victims and given nothing in return. The companies were also legitimate in that they operated from registered premises, paid staff and paid tax. Some customers were refunded when complaints were made. The appellant's previous convictions were not for dishonesty. There was a long delay before trial.

In our judgment, the sentence was not manifestly excessive. It is not the case that the judge did not give reasons for the sentence that he imposed. Rather, in his thorough and careful sentencing remarks the judge gave detailed reasons for his decision on sentence. He rightly recognised that there are no sentencing guidelines for the offence of fraudulent trading and that the fraud sentencing guidelines are relevant only by analogy.

In R v McCrea and Others [2012] EWCA Crim 976 , this court said that in a case of fraudulent trading the judge was entitled to pay some regard to the guidelines for confidence fraud, which bore some similarities to the fraud in that case. A similar view was taken in Mackey .

The judge in the present case was right, however, not to make reference to starting points and guideline category ranges in his sentencing remarks. As the Court of Appeal said in Mackey , this offence covers a wide spectrum of offending. It has been said many times that this court is not often assisted by being provided with examples of sentences imposed in other cases on different facts. That is particularly so in a case such as this in which the range of factual scenarios is so broad. For example, Mackey was a case in which the fraudulent trading arose because what had started as a genuine business had got into financial trouble and the appellant in that case decided to behave dishonestly in the home that it would come right in the end. That is very different from the present case.

For the reasons given by the judge in his sentencing remarks, to which we have referred, the offending in this case was at the top end of the spectrum. This was a cold-blooded, deliberate and cruel enterprise to target the most vulnerable of victims and to sell them something they did not need. Lies were made about their existing insulation and about the benefits of their new insulation; and these vulnerable people were bullied, especially if there was a risk of them changing their minds. This was fraudulent trading on literally an industrial scale, even if the culpability is limited to the 30 witnesses who gave evidence.

The appellant was at the heart of this offending. He was its controlling mind. He sought to operate in such a way as to conceal the fraudulent trading from the authorities. That is why he operated from registered premises and paid tax – and, indeed, reimbursed some customers if he had to.

He carried out this offending whilst he was on licence for other serious offending. His only motive was profit, and the contempt that the appellant showed for his victims is a particularly distasteful feature of this offending. He has never shown a shred of remorse.

The fact that the appellant's businesses did supply the products is not a significant factor. The products that were supplied were not needed by the customers. They cost the customers a great deal of money and they did not provide the benefits that the appellant and his salesforce said that they would provide. Indeed, they cost many of the victims money, either because the insulation had to be removed, or because it reduced the value of the property.

Set against this culpability and the harm caused, the personal mitigation is of very limited value. The delay is of no significant mitigation. In large part it is due to the fact that the investigation took a long time because of the way in which the appellant chose to operate his businesses.

For these reasons, although we have given leave to appeal, the appeal against sentence is dismissed.