A Manchester businessman was involved in a huge international “advance fee” fraud, a court heard.

Michael Rashman and fellow Freemason Carl Montlake are said to have created and operated a number of businesses, beginning in 1990.

The traded in the sub-prime mortgage market for both residential and business properties. Some businesses traded at the same time.

The prime vehicle for the fraud was a company called Alliance International Ventures, which was formed after 1997 to offer funding for foreign commercial projects ranging from $1m to $120m, the court was told.

Rashman was described by Jonathan Turner QC, prosecuting at Liverpool crown Court, as “a clever man” involved in “a clever fraud”.

He said: “It went undetected for six years and many people were taken in along the way, some losing their homes and livelihoods, some their self-respect and respect within their own communities, some their life savings and some the life savings of others who trusted them.”

Mr Rashman, of Kersal Gardens, Salford, denies conspiracy to defraud between January 1, 1998 and April 20, 2004.

Mr Turner told the jury that the fraud was committed by people who charged fees in advance for a service, which they had no intention of performing and did not perform.

Montlake, 47, of Spring Vale, Prestwich, was convicted of conspiracy at a previous hearing and is now serving six years for his part in the fraud.

Explaining the connection, Mr Turner said that Montlake and Mr Rashman were both members of a lodge in Manchester and were both Jewish.

Alliance Ventures traded from an office in Bury New Road in Salford and later in Middleton, as did another of their companies, Prime Finance Ltd.

Mr Rashman played the leading role for Prime but retained his partnership with Alliance and was a co-signatory on the bank account, claimed Mr Turner.

“The big decisions were always mutual. For business purposes witnesses will say Montlake and Rashman were inseparable,” he said.

“The company presented itself as a lending company and invited approaches from foreign businessman for plans or projects for which they required funding.

“If they liked the idea it would be appraised and they claimed they would then provide or organise funding.

“Alliance was in the business of taking money from people dishonestly. Rashman and Montlake knew all the time that there was simply no money to lend — never had been, never would be — so whether their appraiser thought the project was a good one or not was completely irrelevant,” said Mr Turner.

The case continues.