A wealthy rail tycoon fell victim to a multi-billion dollar PPE scam involving the US government. Alan McLeish lost £5million in a business scheme which he was told would lead to a $2.4billion deal during the height of the pandemic.
Bogside Investments Ltd – a company controlled solely by McLeish – is now seeking damages in a Scottish court to recap his losses. The action in the Court of Session being taken against a Christopher Shute and a Graeme Paterson who are named as the defenders on the court document.
McLeish, 63, is a founder and former owner of railway maintenance specialists QTS which he sold for £80million in 2018. The firm, based in Strathaven, Lanarkshire, was a jersey sponsor for Kilmarnock for 10 years while his family have invested in Rangers.
McLeish was told a firm called Obree Global was due £1.9 billion ($2.4 billion) from the supply of personal protective equipment (PPE) to the US government. But the money was apparently being held in a frozen account by a New York law firm.
McLeish claims he was duped by Shute and Paterson into lending almost £5.5million ($7.5 million) – through Bogside Investments – to secure the release of the $2.4billion. The necessary funds were then paid in two lots by McLeish, £400,000 in January 29, 2021 and £5,074,000, 12 days later, on February 10.
McLeish claims both Shute and Paterson pressurised him at the time to release the loan funds – claiming that another investor was interested. They also said he would double his money in a matter of weeks if he transferred the money on time.
But in May 2021, McLeish discovered that the New York law firm knew nothing of the transaction and had never held the $2.4billion. Details have now been revealed for the first time during a hearing at the Court of Session in Edinburgh.
Though McLeish managed to get back some of his investment, the court was told that he was still owed around £5million. At the Court of Session hearing, Shute’s lawyer strenuously denied he was party to any fraud, claiming he was also duped.McLeish had first met Shute and Paterson in January 2021.
He was told they had a “significant investment opportunity” involving a PPE transaction that a contact of Paterson’s had entered into with the US Department of Defense. McLeish learned funding was needed to overcome US regulatory issues so the money could be released and moved to Obree Global in Dubai.
He was then asked to provide the multi-million dollar loan in return for a 15 per cent stake in Obree with the prospect of other contracts. In late January McLeish claimed he was sent a video by Paterson with an online statement for a bank account showing the frozen PPE money held by the law firm.
He is now claiming Shute and Paterson either knew the claims they made over the frozen cash were untrue or had no proof they were.
At the same court Shute has lodged a counter-claim for £150,000 he said he is due from McLeish for legal services in connection with his personal affairs and “ongoing divorce proceedings.” Shute, who is believed to be based in Hong Kong, has also asked that any damages claim against him be “sisted” or stopped.
He says the £5million dispute should be settled by arbitration under a previous Shareholder’s Agreement.
In his judgment of April 25, Lord Braid said of McLeish’s claim: “It is not in dispute the $2.4billion never existed although the first defender (Shute) strenuously denies he was party to any fraud.” He then added: “The first defender has no entitlement to have the action sisted. “The pursuer (McLeish) is entitled to make progress with the action and it would not be appropriate to sist it.”
Neither Shute or Paterson could be contacted for comment. McLeish did not respond to emails and calls from the Sunday Mail.
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