British Madoff admits running £14m Ponzi scheme which ripped off high-profile footballers

Rebecca Camber – Daily Mail January 12, 2011

A conman dubbed the British Madoff who swindled £20million from top footballers and the ex-wife of golfer Colin Montgomerie is facing jail tonight.

Terry Freeman, 62, persuaded 700 victims including police officers, Premiership footballers and Eimear Montgomerie, who won an £8million divorce settlement from the golfer, to invest in his fraudulent pyramid scheme.

He promised incredible no-risk returns on the foreign exchange markets through his company, GFX Capital.

But in reality, he blew his clients’ money on a champagne lifestyle, splashing out on holiday homes in France and Cyprus, luxury holidays, high-powered cars and first class flights around the world for him and his family.

He bought his third wife, Yegana, 30, a £120,000 custom-made diamond engagement ring and lavished £50,000 of Tiffany jewellery on the Russian bride.

But tonight the conman was facing jail after admitting £14million of fraud at Southwark Crown Court.

His victims are now seeking compensation, accusing the Financial Services Authority of failing to stop him trading despite launching two investigations into his pyramid scheme.

Described as the British Bernie Madoff after the disgraced Wall Street financier who ran the largest-ever $65million Ponzi fraud in the US, police believe that Freeman may have stolen as much as £23million, but only 335 of his 700 victims have come forward.

Today he was unmasked as a serial conman who had already been jailed for fraud, had been declared bankrupt three times and disqualified from being a director.

Born Terry Sparks, he served a four-and-a half year sentence for fraud in 1997.

On his release from jail, he changed his name to Freeman, to enable him to set up a trading firm in a plush office in the City of London which he rented for £14,000 a month.

He held seminars at Hanbury Manor Country club in Hertfordshire boasting that he could make his clients millions.

Freeman also used an executive box at Tottenham Hotspur football ground bought for £44,000, to woo City investors, Metropolitan police officers and footballers.

No one suspected that his only financial expertise came from reading self-help books bought on Amazon.

He persuaded Mrs Montgomerie, who had an £8million divorce settlement, to part with £200,000, but she held back from investing more on the advice of others.

She told the Mail: ‘I did invest some money with Terry Freeman, but thankfully only a very small, nominal amount.

‘Thankfully I just had this sixth sense that what was being said sounded too good to be true.

‘Also, a financial journalist I know said to me: “If it sounds too good to be true, then it probably is.”

‘I am so glad I listened to that advice — and to my instincts.’

Another client who pumped £1.4million into his pyramid scheme to fulfill his dream of building a new home, was told by Freeman his investment had risen to £2.7million, only to discover just £14,000 was left in his account. He is now living in despair in rented accommodation.

Freeman’s pyramid scheme worked by offering investors speedy high returns – but the money used to do this was taken from other investors not profits.

Like Bernie Madoff, Freeman’s company ran into trouble when the credit crunch hit.

In 2008 Freeman bought heavily into American investment bank Lehman Brothers, thinking the US government was about to bail it out.

Days later the company went bankrupt, the value of the dollar plummeted and he lost half his total investment fund.

Freeman initially managed to cover up his crimes by moving funds around trading accounts and issuing false statements telling investors they were making 12 per cent profits.

He even sent his clients an e-mail reassuring them that their money was completely safe after the massive collapse of the Madoff fraud.

But his clients were growing suspicious and started to demand their money back.

They included a group of north London gangsters who threatened to kill him when the money was not repaid.

Freeman was so terrified he went to the police for help admitting that he had lost about £20million

He was arrested on February 9, 2009 on suspicion of fraudulent trading and money laundering.

But even on bail he tried to continue the con, renting new offices in Gatwick Airport in July 2009.

Yesterday he admitted fraudulent trading, acting as a director of a company when an undischarged bankrupt, two counts of engaging in a business under another name after being declared bankrupt and two charges of acting in contravention of a disqualification order, between December 31 2005 and July 14 2010.

Three charges of money laundering were allowed to lie on the file.
Judge Geoffrey Rivlin QC told him: ‘I don’t believe there is any possibility of any sentence other than an immediate custodial sentence.

‘These are people who are putting good money into this business and they are being conned into doing it.’

One of Freeman’s victims was roof contractor Peter Beeson, 52, who lost £600,000 by investing in the scheme.

He said: ‘Literally people were fighting to get in on the scheme, it seemed like such a good investment.

‘We’ve hired solicitors and have been to the FSA but they said as there was an investigation ongoing they could do nothing.

‘They shut the door on us. Whenever he is sentenced we will take legal action against them.’

Freeman, from Horsham in West Sussex, was ordered to wear an electronic tag and bailed until sentencing on February 14.

Detective Superintendent Bob Wishart, from the City of London Police’s economic crime directorate, said: ‘Rub away the sheen and you find Freeman is the archetypal fraudster, happy to steal money and ruin lives.

‘People invested their futures with GFX, only to find they had been horribly conned by this criminal.

‘Even after being caught, Freeman was still trying to blame anyone but himself.

‘It was only after a long and painstaking investigation that he finally admitted to the huge amount of personal and financial damage he has caused.’

He added: ‘In these times of financial uncertainty and low interest rates, investors are looking to maximise returns.

‘Anyone seeking to invest in any form of scheme that offers above-average high yields of return should be mindful that criminals are out there preying on unsuspecting members of the public.’should be mindful that criminals are out there preying on unsuspecting members of the public.’


Comments are closed, but trackbacks and pingbacks are open.