Deception (25 page)

At first sight, the now defunct company Southern Union appears to have done little of consequence. Founded in
2002
, its declared activities were wholesale trade in food ‘including fish, crustaceans and molluscs' and ‘other monetary intermediation'. It bears the same name as a former large money-transfer firm based in Zimbabwe, run by a bank close to that country's ruling authorities, which transferred millions of pounds a month, often using ingenious financial mechanisms to avoid currency-control rules and local hyperinflation. The British Southern Union published its last accounts in
2009
and was wound up on
1
February
2011
. A Steven Sugden, born on
20
May
1974
, became a director in
2002
, also registered at the Chapmans' address in Stoke Newington. An outsider might wonder if having a lodger in the couple's one-bedroom flat was rather a tight fit. In
2006
, Mr ‘Sugden', according to company documents, moved to Dublin.

Had Ms Chapman not been unmasked as a spy, Southern Union and its directors would have escaped scrutiny. Yet the documents I have obtained and the evidence of witnesses suggest a tangled story reeking of identity theft, money laundering and secret-service dirty tricks. The story starts with a prominent Zimbabwean businessman called Ken Sharpe, who is a friend of Ms Chapman's father. Mr Kushchenko introduced Mr Sharpe to his Russian wife, Joanna, a former dancer.
^ak
In
2002
the Chapmans honeymooned in Zimbabwe, staying with the Sharpes. Most whites in Zimbabwe fare poorly. But those close to the regime can flourish mightily. American diplomats say Mr Sharpe is friendly with the regime of the Zimbabwean dictator, Robert Mugabe, and active in controversial construction schemes and also the gemstones trade. ‘In a country filled with corrupt schemes, the diamond business is one of the dirtiest,' said a cable published on WikiLeaks, snappily entitled ‘Regime elites looting deadly diamond field'.
²¹
It would be easy to see why someone involved in such business might feel at home in Russia, and be disinclined to open his business affairs to scrutiny. At any rate, Mr Sharpe declined to respond to questions. The Sharpe family is clearly connected with the London company bearing the Southern Union name. Ken Sharpe's sister-in-law Lindi Sharpe is listed on a document from September
2002
authorising the appointment of a director. This is puzzling. A search of Companies House shows no Lindi Sharpe connected with Southern Union.
²²
It is not clear therefore how she was in a position to make such an appointment. In
2006
she and a Kenneth Sharpe were listed on the UK electoral roll at an address in London.
²³
Nobody there responded to questions.

By Mr Chapman's admission, Southern Union was the couple's principal means of support in the early years of their marriage. It paid him £
40
,
000
a year plus a £
10
,
000
payment in return for becoming a director.
²⁴
That is not necessarily sinister: it could just have been a generous father-in-law asking an old friend to make sure that the newly-weds had an income. Mr Sharpe strenuously denies any wrongdoing, or indeed any connection with the UK end of Southern Union. He has said he was a client of the Zimbabwean end of the operation, but did not found it, operate it, or benefit financially from it. But according to Mr Chapman, his Southern Union, as well as handling large numbers of transactions with southern Africa, chiefly Zimbabwe, also made payments on the direct instructions of Ken Sharpe. A foreign intelligence service needing to send money to pay sources and fund operations would have found the company's capabilities interesting.

The links in this chain are individually just curiosities. Why are Russians and Ukrainians involved in what looks like a large money-smuggling operation in Zimbabwe? That could just be people from one corrupt country turning a profit in a place with a similar business culture. But the story is about more than that. One of this operation's patrons appears to have been a Harare-based Russian intelligence officer – Ms Chapman's father. That links the world of Russian espionage (itself often overlapping with organised crime, as we have seen in previous chapters) with the questionable money-transfer business in Harare. The nature of that business is odd too. As noted, spy agencies love the ability to make untraceable payments for clandestine purposes. Finally, the British dimension adds extra spice. In short, an enterprise able to make large numbers of effectively untraceable transactions all over the world, based in one of the most lawless countries imaginable, and with personal ties to Russian intelligence, was operating under the noses of the British authorities. It also had a phantom owner.

Within a month of his marriage breaking up Ms Chapman's husband Alex ceased to be a director. The only remaining director then was Mr ‘Sugden'. The name, date of birth and signature fit a man of that name, a married father of two who works in the telecoms business in Tunbridge Wells – but the Kentish Mr Sugden has never met the Chapmans or heard of Southern Union.
²⁵

An obvious place to find answers to these questions would be Southern Union's accountants, Manningtons of Heathfield, East Sussex. But its senior partner Alan Staples, whose signature appears on the company documents, says he has no instructions that permit him to answer my repeated questions about the circumstances in which his reputable firm registered the company; or whether he or colleagues met in person with anyone purporting to be ‘Steven Sugden'; or took any steps to verify his identity. The main bank involved was HSBC. It declines to comment on whether it has ever had a banking relationship with Southern Union or any company trading under that name. Mr Chapman declines to comment on the circumstances in which ‘Mr Sugden' became a co-director, or indeed on anything relating to Southern Union. It is unclear why the signature used by the director ‘Steven P. Sugden' varies between documents but on some occasions is the same as the signature of the real Mr Sugden of Tunbridge Wells.

All this is odd enough. But the mystery deepens when we follow Mr ‘Sugden' on his purported move to Ireland. The trail leads to Rossmore Grove, a cul-de-sac in the plush Templeogue south-western suburb of Dublin, coincidentally not far from the Russian embassy. According to documents at Companies House in London, Mr Sugden moved there in
2006
, first ostensibly to number
10
, then to number
12
. This is odd. Templeogue is misspelled on more than half a dozen documents. One thing that people tend to get right is their own address. Much odder is that James Farrell, the owner of
10
Rossmore Grove for the past thirty years, has never heard of either a Steven Sugden or of Southern Union. The neighbouring house,
12
Rossmore Grove, was until recently rented out to a number of East European (mainly Polish or Lithuanian) migrant workers. Nobody there recalls a Steve Sugden either. (Nor, incidentally, have the British or Irish authorities approached the occupants.) Only on
1
September
2010
, more than a month after the spy scandal broke, did someone purporting to be Steven Sugden apply to have Southern Union struck from the register. It was dissolved on
1
Feburary
2011
.

A strange clue to this mystery comes from Zimbabwe, where a Steven Sugden works for Mr Sharpe, at his company Augur Investments, a Ukrainian company registered in Estonia. A profile for a ‘Steven Sugden' on an obscure social-networking site called Hi
5
claims the same
20
/
05
/
74
birth date as that cited in the company documents (and belonging to the real Mr Sugden of Tunbridge Wells). The Hi
5
profile also had two other notable features: it said that the Zimbabwean Steven Sugden was based in Dublin and listed his languages as English and Russian.
²⁶
What happened next could be seen as a panicky attempt to cover tracks. I identified and contacted (by Twitter, Facebook and email) the ten or so friends listed on the site. Within twenty-four hours, the mysterious Zimbabwean Mr Sugden cancelled his membership of Hi
5
, deleting the profile.
^al
After a few initial responses, none of the friends was prepared to give any details of Mr Sugden's background or to confirm his identity. Also within twenty-four hours of my enquiries starting, someone deleted an entry for a Steve Sugden based in Dublin on another social networking site, namesdatabase.com,
²⁷
claiming him to be part of the ‘Class of
1992
' from Blackrock College, a leading Dublin secondary school. (Blackrock College School says that nobody called Steven Sugden ever studied there.) A request for contact to a Skype address for a Stephen P. Sugden in Zimbabwe went unanswered. A Twitter feed in the name of stephenpsugden has been protected so that outsiders cannot read it. An email then arrived, in lamentable English, reading as follows:

 

My name is Samantha Procter, i am an assistant to Mr Sugden; It is my understanding that you are trying to contact mr Sugden in order to discuss matters related to the book you are currently working on; Mr Sugden is currently away from the office. Please may you forward all relative information to me, which i will bring to the attention of Mr Sugden upon his return;

 

Repeated requests for clear answers to my questions brought belated and inconclusive replies and then a threat of legal action.

An innocent explanation for this could go as follows. By an unlikely coincidence, two people, both called Steven P. Sugden, share the same date and year of birth and remarkably similar signatures. One of them is from Tunbridge Wells, the other genuinely from Zimbabwe. The latter, who just happens to speak Russian, becomes a director of a London-based company established through questionable means by a relative of his boss. He initially uses the address of a one-bedroom flat rented by his friends the Chapmans, protégés of his boss, and thereafter gives a forwarding address in Dublin. He does so carelessly, misspelling the suburb and even getting the house number wrong until he later corrects it. For prankish reasons he establishes some phoney credentials on the internet purporting to show that he was at school in Dublin. When outsiders start asking questions, he takes fright and clumsily covers his tracks.

Another more sinister version could be that Ms Chapman, in cahoots with her father, was involved in a front company in London that moves money around either on SVR business or as part of some private scheme involving Russian officials and their foreign funds. One director is an employee of her father's friend, a Russian masquerading as a Zimbabwean who has bolstered his flimsy invented identity with genuine personal data from a real person of the same name in the UK. He has created phoney internet clues to add authenticity. When Ms Chapman moves on, so does Mr ‘Sugden', giving a misspelled – and misnumbered – Dublin address. My enquiries arouse first alarm and then attempts to escape scrutiny. Without answers from the Zimbabwean Mr Sugden it is hard to rule out either version.

Precisely what bits of Russia's foreign espionage effort may have been involved, or for that matter how much of Zimbabwe's natural wealth was plundered, can only be a matter of speculation. The operation seems a bit sloppy by the traditionally high standards of Soviet and Russian tradecraft. Why use a living person's identity? Why give two successive next-door addresses (in each case misspelled) in Dublin (another address for a Southern Union company, in Northampton, was also misspelled).
²⁸
Britain's Security Service started an investigation but soon dropped it. It hunts spies, not criminals. Although its officials punctiliously refuse to discuss operational matters, on or off the record, I infer that it believes Mr ‘Sugden' to have used a rather sloppy mixture of SVR techniques for commercial, not espionage purposes. If so, that exemplifies the blurred boundaries between Russian officialdom and wider business interests.

What is clear, however, is the damage done to entirely innocent bystanders. Steven Sugden's name is still listed at Companies House as a director of three defunct companies (Southern Union, Intercon Trading and Africa Connection). The real, Kentish Steven Sugden is not directly out of pocket, though investigating the issue has cost him and his family considerable time and worry. Anyone doing a credit check on him might note, for example, that the companies had on occasion been less than punctilious in submitting their annual reports and accounts; an outstanding loan of £
12
,
000
might also affect his creditworthiness in some eyes. Companies House is unwilling to delete him from their records; the police are unwilling to accept that a crime was committed; Britain's Security Service (MI
5
) has asked him to cease his own investigations into the matter in order not to jeopardise its own, which has fizzled out. The blameless Mr Farrell, and the Crowe family that own
12
Rossmore Grove, have had the addresses of their properties used in a way that is certainly fraudulent and looks sinister. In short, law-abiding people can have their identity and address stolen by the Russian secret service or (at a minimum) its officers' family cronies, and used for clandestine, or even nefarious, purposes, and when this is uncovered, nobody will do anything to help. I return to this subject in the conclusion. None of these awkward questions has clouded Ms Chapman's return to Russia.