Fraudulent luxury car dealer Andrew Mearns’ business activities were laid bare in court today.

Mearns, 57, who conned his clients out of more than £1 million, was been jailed for two-and-a-half years at Sheffield Crown Court.

He ran Gmund Cars in Knaresborough until his fraudulence came to light, and had been trusted to broker the sale of high-value Porches on a “sale-or-return” basis. But he sold them on for cash without the consent of the owner and kept all the proceeds himself.

Prosecutor Matthew Harding said Mearns set up Gmund Cars in around 2000 and ran it as a legitimate business but then ran into severe financial difficulties.

He then started selling the high-value Porsches whose owners had trusted him to broker good deals on their “prized” assets, because he was an expert in the sale and restoration of luxury cars.

Trading while insolvent

Mearns was supposed to liaise with his customers and get their permission for any potential sale, but he ended up flogging the vehicles for cash without their knowledge or consent as he tried desperately to keep his ailing luxury-car business afloat.

He carried on trading when the business was insolvent and took out loans in the hope that he could save the business.

Mr Harding said:

“A number of complaints were made by vehicle owners who said they commissioned Gmund to sell their high-value vehicles but didn’t receive any proceeds of the sales.”

He said that one Porsche owner had taken his vehicle to Gmund because it had “engine issues”. He was told that an engine rebuild was required and paid £3,000 in advance to Mearns who sold the vehicle in 2019 without informing him and kept the cash.

'Cash-flow problems'

Another man took his Porsche 911 Carrera to Gmund in 2016 on a sale-or-return basis. The car had a £55,000 sale price but the owner only received payments which were £35,000 short of that price.

Mr Harding said that Mearns would often tell the frustrated owners that he had “cash-flow problems” but that “all would be well” eventually.

The owner of the Carrera initially accepted Mearns’s reassurances but after waiting two years he still hadn’t received the outstanding balance.

Another owner took his rare Porsche Speedster to Gmund and gave consent for the company to broker the sale of his prized vehicle, but he was hoodwinked in a similar way.

Mr Harding said that the victims gave Mearns instructions that their vehicles should not be sold without them agreeing to the “details of the sale and the price”.

Mearns was supposed to only receive commission for brokering deals by using his contacts with Porsche owners and his knowledge of the famous luxury make.

But he never sought their consent and money from the sales wasn’t passed on to the owners.

“He was using the money for his own commercial purposes to keep the business afloat,” said Mr Harding.

“To placate the owners, they were given a variety of reassurances that (it was) simply a temporary cash-flow problem.”

£1 million losses

He said that the actual, proven loss to the victims was between £1 million and £1.1 million, but the “risk of loss” was £1.2 million.

These losses were mitigated by insurance cover in some cases, but one victim never got any of his money back due to insurance difficulties.

The victim had instigated civil proceedings against Mearns and had incurred over £40,000 in legal costs.

Mearns was arrested in July 2019 and told police he had been struggling financially. He said he had taken out loans in a bid to recoup those losses and keep the business afloat but claimed that the business was “half a million behind”.

“He said he had been ‘robbing Peter to pay Paul,’” added Mr Harding.

He said he had been prevented from paying the money back to the owners because the company had gone into administration but he had continued to try to “trade (his way) out of difficulties”.

Police investigation

In 2022, a financial investigator with North Yorkshire Police looked into Mearns’ and Gmund’s financial records and found that a £105,000 loan had been taken out, of which £99,000 had been paid back into the business.

Mr Harding said that there was no evidence that Mearns had used the money from the fraudulent sales to fund a lavish lifestyle and that Mearns had “acted dishonestly but with good intentions”.

He said that not only had the victims suffered “significant” financial effects, but also emotional distress due to the loss of prized and sentimental assets.

One named victim, whose Porsche was sold by Mearns to a man in Wales, had now started legal proceedings to get his car back under a restitution order.

Mearns, who has since moved to Wales, was charged with 16 counts of fraud between 2015 and 2019 and initially denied the offences. However, he ultimately pleaded guilty to all matters late last year.

He appeared for sentence at Sheffield Crown Court today (August 14).

Declared bankrupt

Defence barrister Alaric Walmsley said that Mearns – whose wife, Samantha was the former Conservative councillor for Knaresborough Scriven Park who also used to work in former Conservative MP Andrew Jones' office – was otherwise a man of “positive character” who had never troubled the courts before.

He said that Mearns, now of Colwyn Place, Llandudno, had been made bankrupt within a month of his arrest in 2019.

He said that Gmund Cars had operated legitimately for many years before encountering financial difficulties in around 2015.

He cited character references from the former general manager at the now-defunct car brokerage and a Welsh MP.

He said that since the demise of Gmund, Mearns had found new employment as a labourer, a mechanic and as a volunteer at a lifeboat charity.

In September 2024, a member of the Welsh parliament hailed Mearns for an “act of heroism”.

'A masquerade for fraud'

Judge Jeremy Richardson KC told Mearns:

“Those vehicles were valuable to their owners and not only in economic terms, but there was an emotional attachment to many of those vehicles.

“Throughout all of this, when enquiries were made by the owners, you were uttering platitudes and reassurance. That was a masquerade for the fraud.

“The consequences for you of this self-orchestrated disaster have been considerable.”

Jailing Mearns for two-and-a-half years, Mr Richardson told the disgraced former car dealer: “I’m afraid you are the architect of your own misfortune.”

Three other allegations, that Mearns had stolen three Porsches with a total value of £250,000, were withdrawn and allowed to lie on the court’s file.