A former operator of an investment scheme has been sentenced to 7 years and 6 months in prison due to his involvement in a Ponzi scheme that defrauded investors of £1.3 million. The prosecution was initiated by the UK Financial Conduct Authority (FCA).
The individual orchestrated the fraudulent scheme known as the Imperial Investment Fund (IIF) alongside another person. The operation, which was run from a bedroom in Devon, targeted 238 investors, with most of them being attracted through Facebook advertisements. These advertisements promised remarkably high returns, claiming investors could earn 1.4% per day, 7% per week, or an astounding 350% annually.
The convicted party, having collected £96,000 from the scheme, lavishly spent the funds on a lifestyle that featured designer clothing, dining at upscale restaurants, and withdrawing £18,000 in cash for personal use. However, the promised returns never materialized. He misled investors into believing that their investments were secure and that he was successfully engaging in trading activities. Even after recognizing that the scheme was on the verge of collapse, he continued soliciting investments.
During the sentencing, the judge highlighted the repeated and deliberate violations of regulatory standards by the perpetrator and criticized the belated expression of remorse. The judge noted the significant negative impact on the victims, who not only suffered financial losses but also experienced embarrassment due to the deception.
In addition to the prison sentence, the FCA is taking steps to recover the proceeds from the scheme and intends to compensate the victims. The convicted individual has also been disqualified from serving as a company director for eight years, with the penalty commencing upon release from custody.
Law enforcement is currently seeking another individual connected to the same fraudulent activities.