Seven Years Jail For Defrauding Clients

by | Feb 4, 2015

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Southwark Crown Court

A man who defrauded clients and promoted a collective investment scheme without authorisation has been sentenced to seven years in jail.

Forex dealer Alex Hope was convicted on 9th January and was this week sentenced at Southwark Crown Court following a FCA prosecution. He and a co-defendant convinced over 100 people to invest more than £5.5m.

Co-defendant of Hope, Raj Von Badlo, who had pleaded guilty earlier, received a custodial sentence of two years for recklessly making false representations to investors and promoting a collective investment scheme without authorisation. He had acted as the main fund raiser for the fund, attracting over 75 investors who handed over £4.29m for Hope to invest.

Hope told his investors that he would successfully trade their money on the Forex market. Yet, only 12% of the money invested in his scheme was ever traded. The majority of the investor’s money went on gambling (spending over £1m in one casino), bars and nightclubs (£600,000), designer clothes (£200,000) and foreign travel (£60,000). The money which Hope traded was nearly all lost.

The scheme was kept going by the falsification of documents, which misled investors to think that it was successfully performing and encouraging more to join the scheme. The new money was to pay off those who wished to withdraw their funds. Acting director of FCA enforcement and market oversight Georgina Philippou said: “Alex Hope presented himself as a trader with a flair for trading on the foreign exchange markets when in reality he spent a good deal of his investors’ money on himself.

“With the assistance of Raj Von Badlo, Alex Hope enticed dozens to invest considerable sums in his fraudulent scheme. This case shows that the FCA will vigorously protect consumers from those who break the law and do whatever it can to get their money back to them.”

The FCA managed to identify and freeze half of the money taken from investors.

Hope’s scheme was shut down by the FCA in 2012. He pleaded guilty to operating a collective investment scheme without authorisation on 23 April 2014 and was convicted of fraud by a jury on 9 January 2015.

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