A man operating an unauthorised collective investment scheme who took more than £5 million from investors and spent £2 million for his own use has been found guilty of fraud by a jury in a UK court.
A man operating an unauthorised collective investment scheme who took more than £5 million ($7.57 million) from investors and spent £2 million for his own use has been found guilty of fraud by a jury in a UK court.
Alex Hope was convicted by a jury of fraud, having previously
pleaded guilty on 23 April last year to operating a collective
investment scheme without authorisation, a statement from the
Financial Conduct Authority, the UK regulator, said on
The FCA prosecuted Hope, who ran a scam which claimed to be making large returns for investors from the profits of his foreign exchange trading.
“Using fraud and false promises, Hope took in those who trusted him to invest their money. He promised fantastic returns but, as is so often the case with unauthorised investment schemes, those who invested ended up with significant losses and the main beneficiary of the scheme was Hope himself. There is a reminder for consumers here that unauthorised investment schemes are often incredibly risky and if the promised investment returns seem too good to be true they most probably are," Georgina Philippou, acting director of enforcement and market oversight at the FCA, said.
Between March 2011 and April 2012, Hope took over £5 million from investors, and used over £2million of this for personal expenditure, the FCA said. Hope told investors that he would trade their money on the foreign exchange markets. Hope held himself out to be a talented and successful trader who could make investors a return of up to 100 per cent in just a few months. In reality, Hope’s trading was heavily loss-making. He lost over £500,000 of the £650,000 held in his trading accounts, it said.
Prior to the trial, Hope’s co-defendant, Raj Von Badlo (also known as Raj Shastri), had pleaded guilty to an offence of recklessly making false representations to investors and a further offence of promoting a collective investment scheme without authorisation at a hearing on 22 July 2014.
Hope and Von Badlo will be sentenced on 16 January. The FCA will instigate confiscation proceedings against both defendants.