The Serious Fraud Office (SFO) has arrested six people in an estimated £300m bribery and fraud investigation into the former management of social housing group Home REIT.
Officers raided six addresses across the UK related to the past management of Home REIT. The firm’s current bosses said they would assist the investigation.
Investors in the company were told their money would be used to buy and restore properties to be rented to publicly funded charities and other organisations to house rough sleepers, veterans and people struggling with addiction, the SFO said.
Home REIT raised £850m in investment in three years before it suspended trading on the London Stock Exchange in January 2023.
Returns had been due to be generated to investors from rent payments, the SFO said.
After one of Wednesday morning’s raids in north London, deputy head of the fraud and bribery division at the SFO Andy Parratt told the that the investigation “impacts some of the most vulnerable people in society”.
He added: “We had over 150 staff involved in the deployment, and so it’s still early days in the investigation, but we are trying to establish exactly what’s happened in terms of the management of Home REIT and the reason that it collapsed.”
Searches and arrests were also made in Altrincham, Maidenhead and Manchester.
Home REIT provided supported housing in self-contained flats and houses of multiple occupancy.
In a 2021 report, the organisation said it worked with 17 not-for-profit housing partners and provided accommodation to more than 3,000 people.
In November 2022, an investor report into Home REIT raised multiple concerns about the company including the valuation of its properties and the ability of its tenants to pay rent, the SFO said.
Solicitor General Ellie Reeves said: “Vulnerable people, including rough sleepers and veterans, were promised homes, while investors who funded millions of pounds were promised returns. Both groups deserve answers.”
Five men and one woman aged between 40 and 80 were arrested on suspicion of fraud and bribery offences, the SFO said.
Emma Luxton, the SFO’s director of operations, said: “This company had a meteoric rise, spending millions on properties that were supposed to house the most vulnerable in society and provide returns for investors.
“Its chaotic downfall has left many with unanswered questions.”
In a statement, the company’s current management said: “Home REIT plc has today been made aware of reports of the SFO’s arrests and raids.
“Naturally, the company will provide any assistance it is able to the SFO in pursuing its investigations.”