Private investors who lost millions when a stable of apparently ‘highly profitable’ and ‘secure’ offshore funds turned out to be nothing more than a sophisticated Ponzi scheme will get at least part of their money back following a High Court ruling.
Many people had ploughed their life savings into the funds and had received monthly statements purporting to show that their investments were growing well. However, the reality was that their money had been squandered on, amongst other things, sales commissions and generous management salaries. The funds had not been profitable and the UK companies which ran them ultimately collapsed, owing over £150 million.
A senior executive involved in the scam had subsequently been jailed for three and a half years after pleading guilty to conspiracy to defraud. The Serious Fraud Office sought orders against him, confiscating his ill-gotten gains and, so far as possible, compensating the investors he helped to dupe.
The Court found that the man had benefited from crime to the tune of £1,567,974 and made a confiscation order against him in that sum. He was given six months to pay the bill or face three years’ imprisonment in default. The Court also made a compensation order in the same amount and noted that it would be appropriate for any money raised to be paid to investors who were defrauded.