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Spreadbetting Fraudster Sentenced to 2 years

18th February 2019

Ex-Director sentenced to 2 years for illegally operating an investment scheme and fraud

This month in a case brought by the FCA, Mr Manraj Virdee, previously the sole director of Dynamic UK Trades Ltd, was sentenced to a 2 year prison sentence, suspended for 2 years and ordered to further carry out 300 hours of unpaid community work.

Mr Virdee’s sentence followed his guilty pleas in December to 4 charges that related to misleading consumers, fraud and the illegal operation of an unauthorised investment scheme worth over half a million pound.

Background to the case:

Mr Manraj Virdee was the sole director of a company called Dynamic UK Trades Ltd. During the period of October 2015 to November 2017, Mr Virdee, through his company, promoted a deposit taking scheme without the authorisation from the FCA. Marketed as an ‘investment package’ this mainly targeted wider family and associates.

In addition, Mr Virdee, in pretending to be a ‘professional currency trader’, even entered into an agreement with one investor to manage £192,500 for spreadbetting – however only £10,000 was used for spread bet trading as promised.

In total Mr Virdee received approximately £600K in funds from investors, some of whom had been ‘guaranteed’ returns of up to 100% based upon his claimed success as a currency trader.

Mr Virdee did try trading just over £457K of those deposits, however, as the prosecution commented, he was ‘spectacularly unsuccessful’ and sadly almost all of the funds from investors were either lost or used to bankroll Mr Virdee’s lifestyle.

The four charges brought against Mr Virdee were for:

• encompassing illegal operation of an unauthorised investment scheme,
• misleading consumers; and
• two related counts of fraud

Sentence passed:

Mr Virdee has now been sentenced to two years in prison, suspended for two years and an additional 300 hours of unpaid community service.

Furthermore, the FCA has obtained a financial restraint order against Mr Virdee’s remaining assets and will pursue confiscation proceedings in relation to Mr Virdee’s remaining assets which will help to go some way towards compensating his victims.

“The FCA’s prompt action nipped Mr Virdee’s fraud in the bud and stopped it becoming inevitably bigger, causing greater loss to a wider group of victims” said Mark Steward, the Executive Director of Enforcement and Oversight at the FCA.

Additionally Mark Steward took the opportunity to remind investors to beware of anyone that is not authorised to carry out the activities they are offering.

Read our latest articles, news and views affecting compliance and regulation in the UK Financial Services Industry.