UK man jailed for his part in a £1.5 million Spanish boiler room scam that has left hundreds of investors with worthless shares

Written by Ray Clancy

Monday, 15 February 2010 09:44

A UK collaborator in a £1.5 million Spanish based boiler room scam that sold worthless shares to over 600 small British investors who will never see their money again has been jailed.
Robert Scott, 63, arranged for shares in two companies to be sold over the telephone through a high pressure sales operation based in Spain between April 2003 and March 2007, Ipswich Crown Court was told.

The companies, Globalcom Trading Limited, a computer based virtual marketplace, and Alternative Diesel Investments Limited, a bio-diesel company, didn’t trade or generate revenue.

The court heard that Scott would receive payments from the investors and issue them with share certificates but in reality, he was transferring 90% of the payments to the ‘boiler room’ while retaining the rest for his own use.

He used some of the money to pay off loans as well as buying luxury cars including a Porsche and a Jaguar while also spending £1,400 on toy trains. Complaints were initially made to the Norfolk and Suffolk police forces, who alerted the Serious Fraud Office in 2005.

He was charged in 2008 in connection with the fraud and in November 2009 he pleaded guilty to two counts of fraudulent dealing and was jailed last week for 33 months.

Nicholas Lobbenberg, prosecuting, told the court that Scott had been in control of Globalcom Trading when in 2004 he arranged for a Spanish telephone share selling business to market shares in the company.

That netted £565,400, all from small investors. The following year Scott made a further arrangement to sell shares in Alternative Diesel Investments in two blocks, one bringing in £311,500 and the second £2.6 million, although it was accepted that Scott had only been responsible for £1 million worth of that, said Lobbenberg.

Lobbenberg said that when talking to investors in the two companies, Scott had told them: ‘You can trust me. I’m a born again Christian’.

His defence lawyer claimed that the two companies had been set up with entirely legitimate aims although they had never been involved in viable trading. Nigel Lithman claimed that Scott has come into contact with a number of individuals of whom he became concerned for his own safety and this had resulted in his decline.

But Judge John Holt told Scott that the case was so serious that only immediate custody was appropriate. Scott is also now banned from acting as a company director for 12 years.