Regulation  

Fraudster jailed for £2.4m fake investment scheme

Fraudster jailed for £2.4m fake investment scheme

A fraudster has been sentenced to eight years in prison for his role in a fake carbon credit scheme, which defrauded £2.4m from 130 victims.

Sami Raja, 32 of Grays, Essex, was found guilty of six counts of conspiracy to defraud and money laundering at Southwark Crown Court last Friday (January 18), following an investigation by the City of London Police.

Along with four others, Raja mis-sold carbon credits to victims through two companies, Harman Royce Ltd and Kendrick Zale Ltd, between January 2012 and August 2013.

Victims would receive unsolicited phone calls from "brokers" at the two companies, often using fake names, who then used high pressure tactics to convince them to invest in types of carbon credits, including voluntary emission reductions and certified emission reductions, at an inflated price per unit.

Between January 2012 and October 2012 brokers at Harman Royce charged victims between £5.26 and £6.50 per carbon credit, totalling a loss of £1.5m, with evidence from an independent consultant suggesting the real trading price for carbon credits at this time was between 25p and 30p.

Brokers at Harman Royce sought the contact details for homeowners aged 50 and above and living in affluent postcodes to target their victims.

The money paid to Harman Royce was used to pay staff wages and purchase luxury items including an Aston Martin worth £33,000 and a £4,000 Rolex watch.

Between May and August 2013 brokers at Kendrick Zale were found to have sold more than 300,000 carbon credit units totalling £900,000, with many investors persuaded to cash in individual savings accounts (Isas) or sell existing shares with reputable companies.

In August 2013 the City of London Police began investigating Kendrick Zale, following information provided by Essex Police and due to its office location in St Mary Axe, City of London.

In September 2013, officers executed a search warrant at the offices of both Harman Royce and Kendrick Zale where Raja and others were arrested and items such as scripts, brochures and sales confirmations were seized.

Hayley Wade, senior investigating officer of the City of London Police fraud squad, said: "The set-up of Kendrick Zale just months after clients of Harman Royce had been defrauded shows the callous nature in which these fraudsters operated.

"Raja cruelly targeted often elderly individuals with the intention of defrauding them of their life savings.

"He clearly felt no remorse for their actions, closing one company, only to set-up another and commit the same offences.

"The custodial sentences imposed will hopefully go some way to deterring others from committing such offences."

The four other men involved in this case were sentenced in September 2018 in conjunction with other fraud cases investigated by other law enforcement agencies, including the Financial Conduct Authority.

Michael Nascimento, 41, of Green Lane, Belmont Parade, Chislehurst, Kent pleaded not guilty and was sentenced to two years for each of the three counts of money laundering to run concurrently.

He was convicted on 13 February 2018 and as a result of the offences investigated by the FCA, he received a sentence of 11 years bringing his total sentence to 13 years.