Currency trader whizz kid 'masterminded £5.5m Ponzi fraud'

 
“Ponzi scheme”: former catering manager Alex Hope, 25, is accused of masterminding a £5.5million fraud Picture: Central News
Paul Cheston2 December 2014
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A foreign currency trader used investors’ cash as his “personal piggy-bank” and blew £1 million in casinos and £500,000 in nightclubs, a court heard.

Financial whizz kid Alex Hope, 25, masterminded a £5.5m Ponzi fraud to fund his hedonistic lifestyle and love of gambling, the jury was told.

Hope transformed himself from Wembley stadium catering manager to currency markets expert and spent £2m on himself in an astonishing binge, Southwark Crown Court heard.

But when suspicions around his Forex fund grew, the Financial Services Authority stepped in to arrest him.

Hope accepts he violating City rules which state he must have a licence to work on behalf of others, although he is allowed to trade currency for his own profit.

Prosecutor Sarah Clarke said: “Despite his youth Hope is at the centre of a multi-million pound fraud.

“He set himself up as a supposedly successful Forex and currency trader and promised investors and potential investors huge returns if they invested in his scheme.

“Hope took an eye-watering £5.5m over a 13-month period up to April 2012, when when the FSA intervened and shut it down.

“The truth was this was not a trading scheme - it was a fraud. Investors funds were in fact paid into his personal bank account and they were used by him as his personal piggy bank.”

Hope splashed about £2m on a playboy lifestyle, blowing around £1m in casinos and £500,000 in nightclubs, the court heard.

Hope used new investors’ funds to pay off those who wanted to leave the scheme, in the classic Ponzi fashion, said Ms Clarke.

His alleged partner in crime, Raj Von Badlo, 56, has admitted promoting Hope as a successful trader to entice people into investing in the fraud.

Van Badlo, who does not appear in the dock with Hope, used PR companies to present Hope as a “talented and successful trader”, the court heard.

Hope, of Canary Wharf, denies one charge of fraud. He has pleaded guilty to carrying on a regulated activity when not an authorised by the FSA.

Von Badlo, of Bourne End, Buckinghamshire, admitted making misleading statements and communicating an invitation or inducement to encourage investment activity.

The trial continues.

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