A cash-strapped Highland businessman who torched his own properties in a “calculated” attempt to con the insurance company out of £400,000 has been jailed for 13 months.
Michael Maggs’ steading project near Nairn had run over budget and over schedule and he saw the fire as a way to solve all his problems, Inverness Sheriff Court was told.
But when his six-figure claim was called into question by the insurance company and the police were called in, his illegal scheme fell apart.
Sheriff Eilidh Macdonald told the 52-year-old, of Beaufort, Culbokie, that it was a serious offence “which was a calculated fraud, involving premeditation and planning”.
“It was motivated by greed. You knew what you were doing,” she told him.
‘He saw setting the fire as his way out’
Maggs appeared at Inverness Sheriff Court last month and admitted the fraudulent scheme, which involved the three-unit Earlseat Steading development at Moyness.
Maggs – a first offender – was due to stand trial on two charges of creating fraudulent schemes but pleaded guilty to one of them.
His defence counsel, Lewis Kennedy, told the court that his client was re-paying £20,000 a month for a second loan secured against the steading and in his wife’s name.
He added that Maggs’ wife, who was threatened with sequestration, had now left him.
“He was in a state of financial stress at the time,” Mr Kennedy said. “The development had run over time and into financial trouble.
“He was unable to make payments for the second loan and that lender was vigorously pursuing payments and forcing a sale as the debts were mounting.
“He saw setting the fire as his way out to retain solvency and save his marriage.”
Made false declarations to insurance company
Mr Kennedy added that the property had since been repossessed and sold at below market value.
At a previous hearing, fiscal depute Martina Eastwood told the court that Maggs had made false declarations to Zurich Insurance to get cover
She said: “He told the company ‘There is heavy fencing all the way around it and I have installed CCTV.’ He was asked if he would be living there and he told them he would be. He obtained £400,000 rebuild cover. ”
However, later investigation revealed that there was no site security or CCTV and he only occasionally lived in a caravan there.
Ms Eastwood added that he had taken out another loan secured on Earlseat and was under pressure to sell the Steading to repay it.
“On November 29, 2017 at 10pm he set fire to three unfinished buildings. There was no risk to neighbouring property or persons.
“He then put in a claim saying it was accidental by unknown means. Zurich investigated and then the police became involved.”
‘Maggs wove a tangled tale’
Following a lengthy fraud investigation Maggs was arrested on October 2 2018 and was charged with insurance fraud in connection to the fire.
Detective Inspector Reuben Lindsay said: “Maggs wove a tangled tale in order to obtain insurance for the buildings he was developing.
“He was economical with the truth and has now pled guilty to causing the fire and deliberately trying to obtain a large insurance payment fraudulently.
“People like Maggs will not be allowed to get away with such fraud and I welcome his sentencing. No matter how long it takes, we will always work to bring those responsible for fraud to justice.”
Scottish Fire and Rescue Service Area Commander, Michael Humphreys, the local senior officer for Highland, said: “The consequences of deliberate fire-setting can be devastating. Fires have the potential to cause serious injury or death, as well as extensive damage to properties and our environment.
“They are also a needless drain on emergency service resources. We continue to work with police and other partners to identify those responsible for these acts.”
Jon Radford, head of intelligence, investigations and data services at the Insurance Fraud Bureau, said: “Insurance fraud is not a victimless crime. It costs everyone and can even put innocent people at risk.
“We’re pleased that our collaboration with Police Scotland and SFRS has helped to bring Maggs to justice.”
