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Ex-City trader jailed for £32m ‘Ponzi’ fraud

A former City stockbroker has been jailed for 13 years after admitting a Ponzi scheme fraud which triggered investor losses of over £32m.

Former City trader Nicholas David Andrew Levene from Barnet in Hertfordshire was sentenced today at Southwark Crown Court after pleading guilty on 24 September to 12 counts of fraud, one count of false accounting and one count of obtaining a money transfer by deception.

Levene admitted between April 2005 and October 2009 he told investors he had bought shares on their behalf when instead funds were diverted to his own personal, business or gambling accounts. Levene convinced investors he was a successful trader by providing them with false “profits” which were other people’s money.

Between 1 January, 2005 and 31 October, 2009 Levene obtained over £250m pounds from investors. Over £18m of investor monies was used to buy property in the UK and Israel, or spent on overseas travel, holidays and lifestyle expenses.

The fraud collapsed in 2009 after a number of investors brought civil court action to recover their monies. Levene was subsequently made the subject of a bankruptcy order on 7 October, 2009. 

The Serious Fraud Office launched a criminal investigation into Levene in October 2009, and charged him on 4 March, 2011. He initially entered not guilty pleas on 28 September, 2011 before changing to a guilty plead ahead of his trial last month.

The SFO is pursuing a confiscation order on Levene’s assets and says it will seek compensation for victims. The confiscation hearing has been adjourned until March.

An application by the SFO for a serious crime prevention order was granted by the court which prevents Levene from promoting or advising on financial investments for five years after he is released from prison.

Passing the sentence, Judge Beddoe QC said: “It was a fraud from the outset, where countless lies were told.  It was rank dishonesty.  There were separate acts of individual moments of betrayal.”

SFO case manager Jonathan Midgley says: “This was a complex and extensive fraud where Nicholas Levene used investors’ monies to finance a lavish personal lifestyle.”

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