Page "Lloyd's of London" Paragraph 34

The ' recruit to dilute ' fraud allegations were heard at trial in 2000 in the case Sir William Jaffray & Others v. The Society of Lloyd's, and the appeal was heard in 2002.

On each occasion the allegation that there had been a policy of ' recruit to dilute ' was rejected, however, at first instance the judge described the Names as the innocent victims [...] of staggering incompetence and at appeal the Court found that representations that Lloyd's had a rigorous auditing system were false ( 376 of the judgment: [...] the answer to the question [...] whether there was in existence a rigorous system of auditing which involved the making of a reasonable estimate of outstanding liabilities, including unknown and unnoted losses, is no.

Moreover, the answer would be no even if the word ' rigorous ' were removed.

) and strongly hinted that one of Lloyd's main witnesses, Murray Lawrence, a previous Chairman, had lied in his testimony ( 405 of the judgment: We have serious reservations about the veracity of Mr. Lawrence's evidence [...].

).