Stockbroker jailed for “Ponzi” fraud

5 Tachwedd, 2012 | Eitemau newyddion

A City trader has been jailed for 13 years after admitting he defrauded investors. Losses are estimated to be over £32 million.

Former city stockbroker Nicholas David Andrew Levene (dob 23/04/1964), of Barnet, Hertfordshire, was sentenced today at Southwark Crown Court after pleading guilty on 24 September 2012 to 12 counts of fraud, one count of false accounting and one count of obtaining a money transfer by deception. The offences took place between 2005 and 2009.

In passing sentence HHJ Beddoe QC stated, “It was a fraud from the outset, where countless lies were told.  It was rank dishonesty.  There were separate acts of individual moments of betrayal.”

Commenting on the investigation Jonathan Midgley the case manager stated, “This was a complex and extensive fraud where Nicholas Levene used investors’ monies to finance a lavish personal lifestyle“.

Background

In pleading guilty Mr Levene admitted that between April 2005 and October 2009 he dishonestly accepted monies from investors. Levene told investors he had bought shares on their behalf when instead funds were diverted to his own personal, business or gambling accounts. To maintain the fraud investors were often provided with false “profits” – in fact, other people’s money. This deceived investors into believing that he was a successful trader.

In total, between 1 January 2005 and 31 October 2009 Levene obtained over £250 million pounds from investors.

The fraud collapsed in 2009 following civil court action by a number of investors to recover their monies. Levene was subsequently made the subject of a bankruptcy order on 7 October 2009.

Benefit

Monies obtained from investors were used by Levene to finance a lavish lifestyle. Over £18 million of Investor monies were used to buy property in the UK and Israel, or spent on overseas travel, holidays and lifestyle expenses.

SFO investigation

The SFO commenced a criminal investigation in October 2009. Levene was charged on 4 March 2011. He initially entered not guilty pleas on 28 September 2011. A change of plea to guilty was entered on 24 September 2012 prior to trial commencing in October.

Confiscation

Confiscation proceedings are listed for 25 March 2013 at Southwark Crown Court.

Further to an application by the SFO a serious crime prevention order (SCPO) was also imposed by the court preventing Levene on release from prison promoting or advising on financial investments for a period of five years.