The Cheshire is suing chartered surveyors, Dunlop Haywards, for £9m following an investigation into alleged fraud by the company’s former head of valuations Ian McGarry.
The writ follows a £50,000 investigation into “extreme inconsistencies” in a commercial valuation made by Ian McGarry – nicknamed “Flash McGarry” – who was arrested and released by police last March.
An investigation by the Serious Fraud Office is ongoing, but no charges have yet been brought, although McGarry remains suspended on full pay following an internal investigation.
The case involved a property near Birmingham, for which McGarry gave vastly different valuations between 2004 and 2005, ranging from £4.5m and £10.5m.
Dunlop Haywards, owned by Erinaceous, which is listed on the Alternative Investment Market, faces claims totalling £35m for alleged frauds.
Nationwide also launched a £26m claim last October, for further transactions involving McGarry.
Erinaceous has made a £4.2m provision for the claims but hopes for any further costs to be met by insurance.
Cheshire confirms that it has issued a claim in excess of £9m in the High Court against two firms which acted for it in connection with a property transaction.
The claim arises out of a loan made to Goldgrade Properties, which subsequently defaulted on the loan.
Cheshire is claiming damages, loss of interest and costs against Dunlop Haywards Limited and Cobbetts Solicitors.