A Yorkshire-based trader has been arrested as part of an investigation into a global Ponzi scheme that cost investors tens of millions of pounds.
City of London Police said yesterday that a 59 year-old was arrested in East Yorkshire by detectives on suspicion of fraud by false representation and money laundering.
So far they've received complaints from 375 people across the UK and around the world, including 33 from Thailand as well as 17 from Australia.
“As the national policing lead for fraud we are well placed to lead investigations of this nature and scale, drawing on the experience, expertise and resources within the force and the relationships we have in place with national fraud agencies and UK police forces," detective inspector Nigel Howard, who is leading the investigation, said.
“We now urge anyone who believes they have fallen victim to an investment fraud, both in the Humberside region and across the UK, to report to Action Fraud.”
Ponzi schemes typically lure investors by offering them a high return, low risk investment vehicle. But rather than investing money in company's stocks, financial products, or other assets, they grow by acquiring new investors. Ponzi schemes eventually implode, because once new people stop investing, the money runs out.
The suspected fraud first came to light in December after the national fraud intelligence bureau found links between 70 action fraud reports with a value of approximately £10m, before referring it to Humberside Police.