The Financial Conduct Authority has succeeded in getting court orders to confiscate £2.1m from eight people involved in selling unauthorised investments in agricultural land.
The Central Criminal Court has made confiscation orders against the two final defendants in one of the FCA’s largest investigations into unauthorised activity.
Operation Cotton led to eight convictions and this week’s orders mean a total of £2,195,496 will be confiscated from all eight defendants.
His Honour Judge Leonard QC directed that all sums confiscated from the defendants be paid in compensation to their victims.
Those who have suffered a quantifiable loss should expect to receive just over 40 per cent of the capital amount owed to them.
Mark Steward, the FCA’s executive director of enforcement and market oversight, said: “The FCA will continue to pursue those engaged in financial crime, including advisers and other professionals who facilitate misconduct or who launder its proceeds.
“We will also take action, wherever possible, to address the harm caused by misconduct, including taking action to strip illegal gains from defendants for the benefit of those who have suffered loss as a result.”
Between July 2008 and November 2011 an unauthorised collective investment scheme was operated through three companies: Plott Investments Ltd (which changed its name to Plott UK Ltd), European Property Investments (UK) Ltd and Stirling Alexander Ltd.
Salesmen for the companies cold-called potential investors to sell them agricultural land that the companies had bought for minimal amounts, as well as land the companies did not own.
More than £5m was extracted from investors to buy land at a vastly inflated price on the false promise of a substantial profit which never materialised.
The eight defendants were Scott Crawley, Brendan Daley, Daniel Forsyth, Adam Hawkins, Ricky Mitchie, Ross Peters, Aaron Petrou and Dale Walker.
The defendants were convicted of various offences including conspiracy to defraud, breaching the general prohibition by conducting investment business without FCA authorisation, aiding and abetting a breach of the general prohibition, possessing criminal property, and providing false and misleading information to the then-FSA in a compelled interview.
Crawley and the salesmen who worked with him were assisted by Dale Walker, a conveyancing solicitor who received hundreds of thousands of pounds into his accounts.
He was convicted of possessing criminal property contrary to section 329 of the Proceeds of Crime Act 2002, as well as aiding and abetting the carrying out of a regulated activity.
Forsyth and Petrou were issued with confiscation orders this week to the value of £62,834 and £4,987 respectively.
If they do not pay these amounts during the time limit they will be sent to prison for 12 months and 10 weeks respectively.
The FCA obtained restraint orders under the Proceeds of Crime Act 2002 against Crawley, Daley, Forsyth, Hawkins, Peters, Petrou and Walker to preserve the value of assets in which they had an interest pending the conclusion of their confiscation proceedings.
In April 2015, Peters was committed to prison for six months for breaching the terms of his restraint order by, amongst other things, dissipating over £237,000 from bank accounts and disposing of Rolex watches and two racehorses.
As of today, Mitchie and Hawkins have satisfied their confiscation orders in full.
The period of time afforded to Crawley, Daley, Forsyth, Petrou and Walker to satisfy their confiscation orders has not yet expired.
damian.fantato@ft.com
