Sentences in bio-diesel investment fraud total almost forty years

Not wine investment but an example of a boiler room fraud using cold calling and high pressure sales techniques. 

4 October 2011

Seven men, who collaborated in a Spanish based boiler- room operation, were sentenced at Ipswich Crown Court today to a total of 39 and a half years’ imprisonment for conducting an £8 million investment fraud.    Following a trial, six defendants were convicted by the jury on the 12 September.  Another pleaded guilty on 6 June at the start of the trial. 

This case involved the selling of shares in bio-diesel company Worldwide Bio Refineries Ltd (WBR).  Further background on the case was available in the conviction press release issued on the 12th September.

SFO reaction

Commenting on the convictions SFO Director Richard Alderman said, “I am very pleased with the sentences in this case which reflect the callous way the criminals preyed on their victims.”

Sentences

Dennis Potter of Singapore (DOB 02/04/39) and Redmond “Ray” Charles Johnson of Tyne and Wear (DOB 19/09/44) were the directors of WBR.

• Potter was sentenced to seven years’ imprisonment.
• Johnson who pleaded guilty under a SOCPA arrangement, (see note 3 for details) was sentenced to three years’ imprisonment.

In addition, Potter and Johnson were disqualified from acting as company directors for 12 years,’’

The remaining five defendants were boiler room operatives and their sentences were as follow:

From Marbella :-

• Steven John Murphy (DOB 13/02/76) was sentenced to six years’ imprisonment. 
• Greg Pearson (DOB 26/08/73) was sentenced to six years’ imprisonment.

From Hertfordshire:-

• Paul Daniel Murphy (DOB 28/09/73) was sentenced to six years’ imprisonment.
• Lee Eliot Homan (DOB 02/07/72) was sentenced to five years’’ and six months imprisonment.

From London :-

• Peter Bibby (DOB 01/09/67) of south London absconded and was tried and sentenced in absentia to six years’’ imprisonment. There is a court issued warrant for his arrest.

All of the five boiler room operatives were also disqualified from being company directors for six years.

In passing sentence, HHJ Overbury said of the fraud “This was a well planned, sophisticated, and well executed fraud dressed up in the language of legitimate business.  It involved deliberate targeting of a particular group of investors.  The Directors actions amount to a breach of trust of the investors.  They had a long lasting effect on the victims who lost their savings.”

On the prosecution case, the judge said, “This was a complex investigation carried out with the utmost professionalism by the SRB [case team] SFO and the Norfolk and Suffolk Constabulary.  All those involved in the investigation are to be commended for their hard work and professionalism.”

This case was prosecuted by the Serious Fraud office in conjunction with Norfolk and Suffolk Constabularies.  Confiscation proceedings will take place at court on a date to be fixed.

Notes for editors:

Vintage Hallmark plc: mixed success for the SFO

The long running series of trials into Vintage Hallmark/ Hallmark Partnership, the largest drinks UK drinks investment scam came to an end this week at Harrow Crown Court. There have been reporting restrictions on some of these cases.

The fraud involved initially persuading American and Canadian clients, mainly from the medical profession, to invest in a range of over-priced alcoholic drinks, including whisky, Cognac, Champagne and wine. The Hallmark Partnership started their sales drive in 1995 and was run by David Lamb, Richard Gunter and Robin Grove. In November 2000 it was 'acquired' by Vintage Hallmark plc. The clients of The Hallmark Partnership were persuaded to swop their investments for equity in Vintage Hallmark plc, who had imposing offices at 36 St James's Street, one of London's most exclusive streets. 

Equity in Vintage Hallmark plc turned out to be worthless when the company collapsed in January 2003 owing just under £80 million, which led to an investigation by the SFO (The Serious Fraud Office) 

The trials

Vintage Wines of St Albans (company linked to Vintage Hallmark/ Hallmark Partnership) 

The first trial involved Richard Gunter and three employees. All were found guilty in September 2008 and Richard Gunter was sentenced to four and half years for fraud. Those convicted included Haroon Khatab, who was later found guilty of another fraud involving Tahir Tandoori Frozen Foods Limited. Khatab was sentenced to two and a half years imprisonment for his part in Vintage Wines of St Albans and he received nine months for his part in the tandoori fraud.

Vintage Hallmark plc

On 1st June 2010 Richard Gunter pleaded guilty to this fraud and was sentenced to five years and is subject to a Serious Crime Prevention Order.

Robin Grove, a fellow director, was acquitted of one count of false accounting, while the jury were unable to come to an agreed decision on charges of conspiracy to defraud. The trial had started in June 2011 and finished at the end of July. The SFO and The Crown have decided against seeking a retrial. 

Disqualified as directors 

In December 2006 Richard Gunter and Robin Grove were banned from being UK directors for 15 years for their part in this investment fraud. The disqualification will run until December 2021. Gunter is prohibited from carrying out investment business in the UK.

Their business partner, David Lamb, committed suicide on 1st November 2003.   

For further details see here.