Regulation  

Threadneedle trader guilty of £141m fraud

Threadneedle trader guilty of £141m fraud

Two City traders, including one who worked for Threadneedle Asset Management, have been sentenced for conspiring to defraud a Russian bank of more than £141m.

The series of complex frauds was uncovered following an investigation by the City of London Police’s fraud teams. 

Georgy Urumov, 37, of Greenberry Street in London, was sentenced to 12 years imprisonment and Vladimir Gersamia, 33, of Kinnerton Street, London, to seven years after being found guilty of multiple fraud offences following a four-month trial at Southwark Crown Court. 

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The complex nature of the fraud presented a challenge for investigators but through painstaking analysis of financial transactions, prosecutors and investigators were able to outline the individual roles played by the two defendants. 

The first part of the fraud was carried out between 2010 and 2011 when Uromov carried out work on behalf of a Russian-owned company Otkritie Securities Ltd (OSL) and manipulated the firm into paying them approximately $25m (£20m) under the false impression it would be distributed to others also joining the firm. 

In the event, Urumov held on to the vast majority of the money. 

Thereafter, further frauds were committed by trading financial products called Argentinian warrants and fooling their employer into purchasing the warrants from other conspirators for four times their value. 

They then pocketed the difference and transferred their gains to bank accounts out of the UK. 

Gersamia, an employee of investment management company Threadneedle Asset Management, played his part by covering up the frauds being committed by Uromov. 

By manipulating the trade in financial products in this way the defendants stood to gain in excess of a further $150m (£121m). 

Money defrauded was then moved between numerous accounts in countries across the world, including the Caribbean, Switzerland and eastern Europe in an effort to cover up its origins. 

The money was also used to purchase a £19m property in St John's Wood. 

Confiscation proceedings have begun to recoup the money. 

Detective Superintendent Maria Woodall, of City of London Police, said both men were respected figures in their industry who defrauded their employers of vast sums of money. 

Det Supt Woodall said: “They went to great lengths to try and launder the money by using the international banking system. 

“I would like to thank the banks involved in this case for their co-operation. 

“I would echo the judges praise for the dedication and commitment of the lead investigator, Detective Constable Barry Ryan for bringing this case to its successful conclusion.” 

Alistair Dickson, specialist prosecutor in the Crown Prosecution Service’s specialist fraud division, said: “These men were successful traders, earning very generous salaries and large bonuses. But that was not enough for them. 

“Motivated by greed they went about defrauding their employers of eye-watering sums of money using a variety of sophisticated methods.