Finance

Australian man Jeffrey Revell-Reade convicted of $126.4m “boiler room” fraud in UK

Kirsten Robb /

An Australian has been convicted of “masterminding” a scheme in the UK that saw unwitting investors fund the fraudster’s extravagant lifestyle, including buying luxury yachts and private jet trips.

The wrap-up of the seven-year investigation by Britain’s Serious Fraud Office (SFO) comes after new research showed more than half of Australian businesses have experience white-collar crime in the last 24 months.

Australian Jeffrey Revell-Reade was convicted in the Southwark Crown Court in London on Wednesday of conspiracy to defraud, after the court heard he masterminded a “boiler room” scheme in which more than 1000 investors were sold shares in non-trading ‘shell’ companies or companies that had been shut down.

The £70 million ($126.4 million) fraud case involved a sales team in Madrid selling shares to these companies with a re-sale restriction of 12 months.

After the period had ended, investors found their shares were worthless, but not before the profits were spent on Wolf of Wall Street-style luxuries including yachts, private jet trips, overseas property and wine collections, reports The Telegraph.

”The victims were deliberately charmed, lied to and bullied, whatever it took to make them send their money to these criminals,” said SFO’s director David Green.

”Over 1000 UK investors were defrauded by these criminals, who caused substantial financial damage and hardship,” he said.

Revell-Reade was convicted with another man, Anthony May, and seven others had previously been convicted last year.

Mark Rantall, chief executive of the Financial Planning Association of Australia, told SmartCompany that ‘boiler rooms’ are illegal brokerages that often operate from a phone or internet-based selling system and generally sell products with a high commission.

“There are often get-rich-quick schemes and unfortunately they target those members of the public that are vulnerable,” says Rantall.

“Consumers need to be wary. If it sounds too good to be true, it more than likely is,” he says.

Rantall says investors need to make sure where they place their money is legitimate and that investors should do background checks, such as on the Financial Planning Association’s website, to see if the person advising them is a member of a professional association.

“They should also be wary of buying these sorts of products worth a substantial amount over the phone. You want to have a face to face meeting [for that],” says Rantall.

“Your hard-earned money is too hard to come by to just give it away,” he says.

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Kirsten Robb

Kirsten Robb is a former journalist at SmartCompany. Previously, she worked at News Corp as a property reporter for Leader Newspapers and the Herald Sun, and holds a Masters of Journalism at Melbourne University.

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