UK fraudster promising 80% returns struck off over £13m scam

Added 16th September 2016

A UK company director has been disqualified by the high court for cheating investors out of at least £13.3m ($17.5m, €15.6m) via a number of scams which claimed to invest in renewable energy.

UK fraudster promising 80% returns struck off over £13m scam

Ian Hamilton, the director of Industry RE, a company which claimed to help reduce carbon emissions by developing renewable energy technology, was found guilty of running a number of ‘alternative investment’ scams between 2009 and 2013.

‘Eco Resort’ scam

Two of the most popular schemes involved money circulation whereby the 37-year-old sold land in Dominica that would be used to build an ‘Eco Resort’, which on closer inspection was land which the company never owned.

All of schemes were conducted using aggressive cold calling tactics, which IRE had subcontracted out.

80% returns

Industry RE managed to con investors out of £7.6m by promising them a staggering 80% on their £25,000 investment within two years. None of the investors have ever received any returns.

Carbon credits

Another scheme, involved investors buying what they thought were ‘carbon credits’, which Industry RE said it would repurchase within 12 months at a 30% mark up, and sell the credits onwards to a connected company in Dubai.

“As is so often the case, if an investment scheme appears too good to be true, it probably is.”

Despite Industry RE claiming that it had made payments totalling more than £8.6m to customers as ‘investment returns’, an investigation by the UK’s Insolvency Service found the firm had not invested the money and had not made any profits that it could use to pay investors.

As a result of the scam, investors have lost more than £5.7m.

‘Solar bond’ Ponzi scheme

A smaller scheme involved selling so-called ‘solar bonds’ which promised a 10% return per annum for five years, after which investor would get their capital back.

The Insolvency Service’s probe found the scam to be a Ponzi scheme whereby instead of investing in any such solar scheme, IRE used money from newer investors to service the “interest” payments of existing clients.

Dubai connection

A number of ‘customer updates’ were circulated by Industry RE between December 2012 and August 2013, where Hamilton said the firm had relocated to Dubai and gave a number of purported explanations why the company was delayed in making payments to customers.

In December 2012, more than £1m was transferred from the company’s bank account in a single day.

Hamilton told the specialist unit at the Insolvency Service the money was being held by a connected company in Dubai, but he failed to provide any information to support his version of events, or to cooperate in any way with the official receiver or the liquidator.

Following a hearing at the high court, Hamilton has been banned from being a company director for 15 years while the HM Revenue & Customs has now wound up the company.

‘Too good to be true’

Tony Hanon, official receiver for the public interest unit at the Insolvency Service, said: “The company persuaded members of the public to part with substantial sums by falsely promising investors extremely high rates of return.

“In reality, the scheme operated only for the benefit of those running the company, principally the director, Ian Hamilton.

“As is so often the case, if an investment scheme appears too good to be true, it probably is.”

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Monira Matin

Senior Reporter

Monira joined International Adviser in March 2016 from Informa Global Markets where she worked as a eurobond reporter for over two years, covering fixed income markets. She has previously held a number of editorial positions covering politics, insurance and technology. Monira has a degree in Journalism and Economics from City University.

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