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Former stockbroker Nicholas Levene faces jail over £32 million fraud
Nicholas Levene, the former financier nicknamed "Beano", is facing jail after he pleaded guilty to a £32m fraud.
Beano, the stockbroker who hobnobbed with the famous, admits £32m ponzi fraud. A judge has warned Nicholas Levene, a former high-profile stockbroker, that he is facing a "substantial" jail sentence after he pleaded guilty to a £32 million fraud.
He was the very image of the successful City stockbroker, throwing lavish parties, flying by private jet to the south of France, and rubbing shoulders with Britain’s financial elite.
However, behind the facade of extravagance presented to the world by Nicholas Levene lay fraud on a vast scale.
Levene, 48, faces a “substantial” jail term after he admitted cheating investors out of more than £32m when he appeared at Southwark Crown Court in London on Monday.
Among his victims were Sir Brian Souter and Ann Gloag, the brother and sister who founded the Stagecoach Group, who each lost £5m. Levene, a former deputy chairman of Leyton Orient Football Club who is nicknamed “Beano” because of his love of the children’s comic, led a flamboyant life in which he indulged his love for Bentley cars, extravagant yachts and hosting £10,000-a-day pheasant shoots.
He also gambled huge sums, reportedly losing £720,000 on a cricket game in 2008 and £250,000 when Chelsea failed to win the Premiership in 2008-09. Related Articles
The financier was friends with leading businessmen including Sir Philip Green, the billionaire Topshop owner, the Tchenguiz brothers, the property magnates, and Richard Caring, owner of The Ivy and Le Caprice restaurants in London. In 2009 he laid on a party for one of his sons in a marquee beside the Thames in London featuring a live performance by the girl group The Saturdays.
Financial commentators have compared Levene’s fraud with that by Bernard Madoff, 74, who is serving a 150-year sentence in the US after pleading guilty to running the largest Ponzi scheme in history, estimated to be worth $64.8bn (£40bn). A Ponzi scheme pays returns to investors from other savers’ money or their own, rather than legitimate profits. Fresh funds are raised by promising inflated returns to newcomers.
The court heard that Levene took £5m from both Sir Brian and Mrs Gloag between February and May 2009 having told them he would buy shares on their behalf in HSBC, the multinational bank, and Xstrata, the mining giant.
The former broker admitted defrauding Yigal Ahouvi, an Israeli investor, of £14.9m in April 2007 by claiming that the cash, which was transferred to a Monaco bank account, had been used to buy 7.15m shares in Delek Global Real Estate. He pleaded guilty to cheating 10 other investors after they gave him money to buy shares in companies such as Rio Tinto, the mining corporation.
Andrew Edis QC, prosecuting, said: “The total sum of money recorded in fraud counts to which Mr Levene has pleaded guilty is £32,352,027.83.” He indicated that other charges against the former broker could be ordered to lie on file.
Judge Martin Beddoe warned Levene he would face a “severe” jail term, telling him: “Although I will give credit for the pleas of guilty, there will inevitably be in your case substantial sentences of imprisonment for the 14 matters you have acknowledged your responsibility.”
Levene, who admitted 12 counts of fraud, one count of obtaining a money transfer by deception and one count of false accounting, was granted conditional bail until his sentencing on October 22.
The son of a north London electrician, he became a broker at a series of companies and once worked alongside Nicola Horlick, the City “superwoman”, at her investment fund Bramdean Asset Management.
Funding for Lending: Banks sign up to new scheme
Five of the UK's six biggest lenders have signed up to the Funding for Lending scheme, designed to stimulate the economy by making cheaper loans available to firms and individuals.
HSBC is the only one of the top six not taking part, as it says it does not need additional funding.
The Bank of England, which runs the scheme, said 13 banks and building societies had signed up so far.
They represent 73% of the market and £1.2 trillion worth of lending.
The institutions can borrow the equivalent of up to 5% of their loan books immediately, and more if they meet certain conditions over the next year.
Based on that, about £60bn of Bank of England funding has been provided so far.
Paul Fisher, the Bank of England's executive director for markets, said that a "significant number" of other banks and building societies were close to signing up.
"I am confident that the FLS [Funding for Lending Scheme] will help the supply of credit," he said.
"Before its introduction, it was more likely than not that the stock of credit would contract further over the next 18 months," he said.
The banks and building societies that have signed up are: Aldermore, Barclays, Hinckley & Rugby Building Society, Ipswich Building Society, Kleinwort Benson, Leeds Building Society, Lloyds Banking Group, Monmouthshire Building Society, Nationwide Building Society, Principality Building Society, RBS Group, Santander and Virgin Money.
Four men have been charged by the Financial Services Authority (FSA) with conspiracy to insider deal between 1st November 2006 and 23rd March 2010.
Martyn Dodgson, a senior corporate broker, Andrew Hind, Benjamin Anderson and Iraj Parvizi have been bailed to attend Westminster Magistrates’ Court on 19 October 2012.
The charges arise out of Operation Tabernula a long- running joint investigation
between the FSA and the Serious Organised Crime Agency (SOCA). Operation Tabernula is the FSA’s largest and most complex insider dealing investigation to date.
A number of individuals remain under investigation.
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