Alok Dhanda targeted 41 victims, some of whom he had known for more than 20 years and others who were vulnerable, causing “immense damage” to them and their families.
Sentencing him to five years and eight months in jail, Judge Brian Forster QC described Dhanda’s crimes as “devastating” and “in every sense a nightmare” for those involved.
Newcastle Crown Court heard today how he convinced victims they were buying property in India, but spent their investments on gambling, holidays and his “extravagant lifestyle”.
In 2006 Dhanda won Citywire’s New Model Adviser of the Year award.
As well as the “ponzi” scheme, Dhanda, 53, went to his victims, who saw him as a personal friend, for loans claiming he had fallen on hard times.
James Adkin, prosecuting, told the court Dhanda claimed his sister-in-law was seriously ill and that he hadn’t enough money to feed his children.
He also told them he needed to travel to India because of family problems in order to squeeze every possible penny from his unsuspecting victims.
Mr Adkin said: “Between 2007 and 2014 he abused his position of trust to defraud 41 victims.
“The defendant had a habit of going back to the same people more than once because he had an in-depth knowledge of their particular circumstances.
“Some of them were retired and invested substantial amounts of their life savings with him.”
The court heard a total of 41 investors lost a total of £2,909,762.22 in the scam.
A number of victim impact statements were read to the court in which victims described sleepless nights, weight loss, shame and sickness as a result of taking part in the scheme.
One woman was so sucked in by Dhanda that she took out a credit card, which she had never done in her life, just to help him out of a tight spot.
In her impact statement she said: “I feel stupid and embarrassed, I have always thought I was a good judge of character, I am exhausted from having to put on a brave face when asked how I am.”
Another victim, a retired teacher, said: “Despite the fact that my wife and I have taken part in stress-management classes, we have suffered headaches and sleeplessness.
“We intended that our grandchild and prospective grandchildren would have a good start in life but this is much less likely now.
“Our trust in financial advisers has been completely diminished, leaving us to deal with all of our own financial matters which only adds to our stress.”
Dhanda, of Grove Park Square, Gosforth, Newcastle, admitted 37 fraud charges.