A fraudster who scammed more than 100 investors out of £5.5m and spent nearly half to fund his lavish lifestyle has been jailed.
Alex Hope, 25, set himself up as a City trader with a flair for the foreign exchange market but in fact spent much of his investors’ cash on himself, the Financial Conduct Authority said.
Some £2m of investors’ money was used to fund Hope’s lifestyle, including £1m which he spent in a casino, more than £200,000 on designer watches and shoes, £60,000 on travelling abroad, and more than £600,000 in bars and nightclubs in London, Miami and New York.
Hope was sentenced on Friday to seven years in prison, after being convicted of fraud following a trial at Southwark crown court in London earlier this month.
Judge Deborah Taylor said the impact on investors had been “significant”. Hope, who used to work as a catering manager at Wembley Stadium, had “shown no acceptance of his own dishonesty,” the FCA said.
His co-defendant, Raj Von Badlo, was sentenced to two years after admitting recklessly making false representations to investors and promoting a collective investment scheme without authorisation.
Hope hit the headlines in 2012 when he reportedly blew more than £200,000 on champagne at the Playground Club in Liverpool’s Hilton Hotel.
The court heard he exaggerated his trading abilities and the returns he was making and used doctored copies of statements from his trading account to mislead investors, the FCA said.
Despite telling his investors he would trade their cash successfully on the foreign exchange markets, only 12% of the money Hope received was ever traded and when he did trade, he lost almost all of it, the FCA said.
As a result of his deception, Hope continued to attract investors and used new money to pay those who wished to withdraw their funds, according to the watchdog.
Von Badlo promoted Hope’s scheme and persuaded 75 investors to hand over £4.29m, the FCA said.
The scheme was closed down by the FCA in April 2012 and around half of the money taken from investors was identified and frozen.
In April 2012, the Financial Services Authority, the FCA’s predecessor, obtained a restraint order against Hope’s assets and he was arrested. His home was searched in a joint operation with City of London police.
Hope pleaded guilty in April 2014 to operating a collective investment scheme without authorisation and was convicted of fraud by a jury on 9 January this year.
Georgina Philippou, the FCA’s acting director of enforcement and market oversight, 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.”