A landlady accused of earning thousands in rent when she was a bankrupt who owed more than quarter of a million in unpaid tax will not now face prosecution.

Madelaina Eftekhari, 57, had faced 11 charges brought by the Insolvency Service.

But after hearing from two psychiatrists at a hearing last month, Oxford Crown Court’s Judge Michael Gledhill KC ruled that the Summertown woman was not fit to plead or stand trial.

On Monday, prosecutor Rufus D’Cruz told the same judge that the Insolvency Service had halted the prosecution on the basis that it was no longer in the public interest to proceed.

Even if a jury decided after hearing evidence at a special type of trial that she had ‘done the act’, Mr D’Cruz said there were realistically only two forms of sentence available to the judge.

She was unlikely to comply with the first, a mental health supervision order, it was said. And the second was an absolute discharge – allowing her to walk from court with effectively no punishment.

He asked the judge to allow the charges to ‘lie on file’, meaning that they could be resurrected at some future date but only with the permission of a judge at Oxford Crown Court or the Court of Appeal in London.

Judge Gledhill allowed the request. Leaving the charges ‘on file’, the judge said on Monday: “There is, albeit a remote possibility, that Ms Eftekhari will in due course be fit to plead and be fit to be tried.

“It is unlikely, because certainly at the present time she would not cooperate with any treatment that would lead to her recovery.

“But there is that remote possibility in due course she could be fit to be tried.”

Eftekhari, of Hobson Road, Oxford, has never been asked to enter pleas to allegations of carrying on a business fraudulently, obtaining credit while a bankrupt, acting as a director while a bankrupt, using a false instrument and making a false statement in a statutory declaration.

It is understood she denies any wrongdoing.

Prosecutors had claimed she was running a residential property lettings business from 2012 to 2018 ‘with intent to defraud her creditors’.  

She was accused of obtaining more than £44,000 in ‘credit’, including rent payments, and acting as a director of Hernes Close Residents’ Association between April 2014 and March 2016 while an undischarged bankrupt.  

The Insolvency Service also said she failed to disclose that she owed £270,000 in tax or that she was able to use another’s HSBC bank account.

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This story was written by Tom Seaward. He joined the team in 2021 as Oxfordshire's court and crime reporter.  

To get in touch with him email: Tom.Seaward@newsquest.co.uk

Follow him on Twitter: @t_seaward