Michelle Young: The wife who turned detective to expose her 400million cheat of a husband "living it large" whilst pleading poverty


The wife who turned detective to expose her 400 million cheat of a husband 'living it large' whilst pleading povertyMichelle Young was left with nothing when she divorced millionaire property developer ScotShe has spend six years investigating the financial scheme which she accuses her ex-husband of using to hide his 400 million fortuneScot Young, 50, is allegedly broke yet regularly dines in top restaurants

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UPDATED:

22:35 GMT, 8 December 2012

Michelle Young is sensing victory. Six years after she began what seemed like a hopeless High Court battle, she is close to unravelling a complex financial web that hides what remains of her husband’s 400 million fortune.

It was in 2006 that Scot Young, a controversial property developer, walked out of their 11-year marriage, declaring that the collapse of a Russian development had left him with debts of more than 28 million. Michelle and her two daughters were left all but penniless.

However, she has turned detective and, after painstaking research over the past six years, has uncovered a range of devious subterfuges used by her own husband and other wealthy men to ensure she and their estranged wives are left impoverished.

Tough talk: Michelle Young is resolute in her pursuit of justice against her ex-husband Scot whom she believes is hiding a fortune whilst leaving her with nothing

Tough talk: Michelle Young is resolute in her pursuit of justice against her ex-husband Scot whom she believes is hiding a fortune whilst leaving her with nothing

It involves expensive accountancy, a network of willing friends, and a criminal subterfuge known in the underworld as ‘smurfing’.

It is little wonder she is suspicious about Young’s motives. Aged 50 and allegedly broke, he has since acquired a glamorous 29-year-old girlfriend, who appears content with a man who claims he is ruined. He likes to say he wants to keep a low profile, yet the two of them are regularly seen dining at The Ivy or Cipriani – two of London’s most exclusive restaurants.

This has been an unusually acrimonious fight. Indeed, if Michelle wins, it will be the most expensive divorce in British history. But it is a war that she appears to be winning, thanks in no small measure to loans of more than 3 million from unnamed investors, who have been promised a share of any eventual return.

A succession of High Court judges has refused to accept Young’s pleas of poverty, demanding he provide evidence to show how his money disappeared overnight. One judge awarded Michelle a record 27,500 a month, convinced that Young could afford it.

Then last month, Mr Justice Moor, sitting in the Family Division of the High Court in the Strand, gave Young 28 days to provide full disclosure of his finances, or face the six-month prison term that was originally handed down in 2009 for not having done so. His time is almost up.

‘The threat of imprisonment is the
only thing that will bring him to heel,’ says Michelle. ‘He has, until
now, lied, prevaricated and basically ignored every court order for him
to provide a full account of what happened to his money and properties.
His aim all along has been to drag it out until I ran out of money.’

At the outset, Michelle naively believed her husband would settle, leaving her a generous sum.

Young
had made a vast amount of money buying and selling prestigious
properties around the world and she enjoyed a luxury lifestyle.

Staying strong: Michelle with her teenage daughters Sasha and Scarlet

Staying strong: Michelle with her teenage daughters Sasha and Scarlet

During her marriage, she regularly flew in private planes, ordered her weekly shopping from Harrods and was the chatelaine of a nine-bedroom Regency mansion in Oxfordshire.

It was a charmed life and, although she helped out with various property deals, she never concerned herself with the minutiae of the business that funded her lavish living. She preferred, instead, to concentrate on her role as a good wife and mother.

Their daughters, Scarlet, 19, and Sasha, 17, still live with Michelle. ‘I thought he would do the right thing and look after his family,’ she says. But she has not seen a penny of the maintenance she was awarded in 2009.

We meet in her modest rented flat in
Victoria, Central London. She is oozing confidence, buoyed by the
knowledge that things are turning her way. She has become the champion
of wronged wives, taking rich men who refuse to pay their wives a fair
divorce settlement to task.

She
was not always quite so optimistic, however. For the first four years
of Michelle’s epic battle with her well-connected husband – they have
yet to divorce – she acted largely alone.

‘A
lot of people took my money, but I never saw any real results,’ she
says. ‘I sold all my jewellery and used all the spare cash that I had to
keep things going. Eventually I got some funding, but it was like
wading through treacle.’

It is only during the past two years that she has made a breakthrough in her search for the missing marital assets.

And
now, after securing a major new funder, she has enough money to see the
case through. She has gathered a committed team of lawyers, forensic
accountants and corporate investigators, who have already delivered
significant results.

Although Michelle declines to name the
investor, or say how much he put up, the sum is believed to be in the
region of 3 million. In return, he will get a hefty slice of the
settlement recovered from Young. It is an investment deal.

Pleading poverty: Scot Young pictured in 2009 leaving the High Court in London

Pleading poverty: Scot Young pictured in 2009 leaving the High Court in London

‘I had to lay out my evidence to him,
like any business person trying to get a bank loan,’ she explains. ‘He
believed I had a strong case, or he would not have given me the money.’

She has just returned from another meeting with the team, at what she likes to call her ‘war room’.

‘Things are beginning to unravel. We
are slowly untangling the paper trail to show that far from being the
pauper he pretends, Scot has been “living it large”.’

Her
words spill out rapidly as she explains that she saw ten previously
unidentified properties from her husband’s portfolio, held by the
prestigious business law firm Fox Williams.

‘I
didn’t even know about these,’ she says. ‘It’s part of the vast list of
assets he is supposed to have lost, which are now being released
because he wants to avoid going to jail.’

She
already has a damning dossier of evidence, which includes
correspondence indicating that Young deliberately made himself bankrupt,
documents detailing a new banking trust set up for him in the Isle of
Man in 2009 and papers showing that he is still involved in
multi-million-pound deals.

‘There
are also two accounts in the names of his friends, through which money
is being funnelled for his daily use. That’s how he’s been funding his
lifestyle. I’ve been told that he pays for everything with wads of cash
stuffed in his pocket.’

Much
of this new evidence was found during an early-morning raid on a hotel
room off the Bayswater Road near Hyde Park in West London in March.

Court officials, with a
search-and-seizure order secured by Michelle’s lawyer, confiscated
several cheques, including two amounting to 32,500, which had no name
for the payee. Three laptops, eight active mobile phones and large
quantities of paperwork were also recovered.

‘It
was obvious that he was using the place as a makeshift office,’
Michelle says. ‘The cheques were issued by Baron & Co, a company
controlled by George Constantine, a director of several companies owned
by Scot and one of his close friends. Mr Constantine has told my
lawyers that he was giving money to Scot.’

High
Court officials carried out simultaneous raids the same morning on Gire
House Capital, another law firm used by Young, and the home of his
girlfriend Noelle Reno – the former fiancee of millionaire banker
Matthew Mellon.

Michelle says the new team has put together a clearer picture of her husband’s determination to hide his wealth.

‘I’m truly staggered by the calculated way that he set about making it disappear. He restructured his assets, with layers of elaborate and overlapping trusts in more than 20 countries.

‘It was coldly orchestrated and
ruthlessly executed. We have no contact now, but when I see him in
court, trying to get the judge’s sympathy, I find it hard to believe
this is the man I once loved.’

Her
team has made sense of the chance disclosures of the past. Michelle
discovered his duplicity by accident after he gave one of his daughters
an old laptop as a gift and she found computer experts to retrieve the
deleted information.

Michelle
took Young to court and in 2009 he was ordered to give full disclosure
of his assets. But he had himself been detained in hospital under
Section 2 of the Mental Health Act.

‘It
was a tactic to deceive the court,’ Michelle says. ‘We’ve evidence he
was busy conducting a million-pound transaction in South America at the
time.’

She is especially
angry that her husband refused to look after his children. In December
2009, Mrs Justice Black awarded Michelle 27,500 a month in maintenance,
plus a further 6,000 for school fees and rent. Young promptly made
himself bankrupt.

His primary creditor was Revenue
& Customs, but he allegedly owed substantial sums to several
associates with whom Michelle says he’s remained on friendly terms.

Although
some properties were indeed repossessed, some seemed to have been sold
cheaply to friends. ‘He has managed to shrink an empire built around
some of the most expensive areas of the country,’ Michelle says. ‘It
took a lot of planning, but he could only have done it with the aid of
people willing to hold some of those assets.’

Sunnier days: Scot and Michelle with Sasha and Scarlet on holiday in the Med in 2000

Sunnier days: Scot and Michelle with Sasha and Scarlet on holiday in the Med in 2000

She has accused some of her husband’s associates of helping to hide his assets.

‘One man told us how he kept money in an account for Scot. The cash was then withdrawn over a number of days from various machines. It’s called smurfing and is used mainly by criminals.’

Young, who has represented himself in court from the outset, had hoped the case early this month would end in his favour and planned a Christmas wedding with his girlfriend. He told The Mail on Sunday that after losing his money he relied on friends to let him stay in their homes, or lived in modest hotels.

He has now moved into a flat in Central London with Noelle, but says he is unable to work because of the negative publicity of the divorce. The court is holding his passport.

‘I want to look after my family, but it’s been difficult to get back on my feet. I’ll do everything possible to comply with the court order. I just want this to be over so that I can get on with rebuilding my career,’ he says.

Michelle remains unmoved. ‘This is not just about money,’ she says. ‘It’s also about principles. Some people might say that I’ve become obsessed, but all I want is justice for myself and our two daughters.’

Yet there were times when she was distraught by the slow grind of the legal system.

‘I’m appalled that he’s been able to manipulate it to his own ends. He’s failed to produce documents when ordered by the court, claiming to be either suffering from gastric illness or a breakdown.

‘Occasionally I’ve felt like giving up. But I want to set an example for my girls; to show them that it is important to fight for something when you believe you are in the right. Too many rich men think they can walk away from a long marriage without facing up to their responsibilities,’ says Michelle.

She is determined not to lose. ‘I would gladly sit down privately and come to an agreement, but he’s stubborn.’ So is she. ‘I’m not the woman I once was,’ she says. ‘I spend my days reading documents – there’s a room full of files for this case. I’ve had to learn a lot about the law, insolvency bankruptcy, accounting.

‘It’s not been easy but, ultimately, I knew my cause was just. Scot and I started out with nothing and built what we had together. I helped to find some of the properties, co-signed documents for loans and managed much of the refurbishment. I did not deserve to be treated like this.’

Michelle has started dating and has a close circle of supportive women friends. ‘My life is more fulfilling. I’ve learned a lot about myself and have been surprised by my strength and resilience. I want to try to raise awareness and help other women going through the same drama.

‘People said I’d never be able to prove my case, but it’s all coming together. There should be a lot of very nervous people at this stage.’