The Plan by John Francis Kinsella
Barton was not totally surprised when he received a mail from Halfon, announcing he had acquired a large block of shares in a mining company called Gambia River Minerals. As the name seemed to indicate, it held mining rights to gold and other precious metal deposits in Senegal. The company planned to open a large mining complex in the south of the country where according to a Senegalese Ministry of Mines’ report an ore body existed, containing viable deposits of gold, silver, copper, lead and zinc, proven by geologists. The company announced its intention to raise capital by a flotation on the London Stock Exchange and was offering early investors preferential shares.
Barton checked the website of Gambia River Minerals and found downloadable company reports including: geological surveys, maps, details of concessions and letters from ministers. The site was well designed and convincing. A little more research showed that Gambia River Minerals was the clone of an FSA authorized company.
He remembered meeting one of Halfon’s partners in the Basque Country, David Jameson, a Londoner, whom he had instantly recognised as a conman. It was evident Halfon was running a well-organized boiler room scam, like so many others found in the murky corners of financial markets and especially in the mining and property businesses. What always surprised Barton was how gullible investors fell for such scams; the answer was as always to do with cupidity, the lure of easy gains.
Halfon’s mail gave the impression his company, BRIC Securities, was based in the UK. In reality it was nothing more than a £100 off-the-shelf Gibraltar company, though its letterhead announced a prestigious address on Aldersgate Street in the City of London.
The director of the Senegalese company was listed as a certain David Kessler. The name rang a bell. Kessler had been arrested on suspicion of fraud related to online financial services for FOREX trading, stocks, futures and options. The fraudster had narrowly escaped jail by absconding after being remanded on bail pending further investigations, resurfacing some months later at an investor’s conference in Dakar, where he met and teamed up with Halfon.
Kessler reported, ‘We are confident our concession will prove to be one of the Senegal’s most important deposits of precious metals. Our plans are to start production in 2013.’
Their objective was to raise twenty million pounds from investors by pressurized selling, then using offshore structures to launder the funds. With Kessler’s experience and know-how combined with Halfon’s cunning, they set-up a network of offshore front companies in Gibraltar, Switzerland, Andorra, Hong Kong and Dominica. Salesmen were hired and trained in pressurized selling techniques; their plan was simple, if the story was repeated often enough they would end up snaring enough naïve investors to finance Halfon’s crooked business plans.
As funds rolled in, the partners in crime diverted the funds to expanding their business into Spain, where they could take advantage of endless opportunities offered by an ever increasing number of distressed property firesales. They bought homes and apartments at knockdown prices, transferred them to an offshoot of Malaga Palms, then resold them to Russian and other inexperienced punters via websites and high pressure selling.
They worked in the knowledge that the FSA and overseas authorities would take years to unravel the web. They dismissed any thought the EU fraud investigation agency, Eurojust, could catch-on to their game; it was submerged under a mountain of complaints from investors who had lost their money in the financial crisis.
They built a legitimate façade of brokers to peddle shares in the mining company, used genuine companies to keep accounts. Real mining engineers were employed to carry out surveys and prepare reports. There was talk of flotations, but in reality Halfon and Kessler siphoned off the capital raised, announcing, from time to time, rescheduling pending the receipt of suppliers tenders for machinery and production plant.
From a legitimate call centre in Dakar, their skilled expat salesmen sold shares issued by subsidiaries companies of Gambia River Minerals and Malaga Palms. Their holding in Gibraltar banked investor capital, which was siphoned off to various accounts in the Caribbean.
It was a classic boiler room style company with its unregulated offshore financial structure using high-pressure sales techniques to sell shares in high-risk companies at inflated prices.
In the UK, it was illegal for any person or firm to provide investment advice or to arrange investments unless authorised by the FSA. Fraudulent offshore investment firms such as Halfon’s Gambia River Minerals or Malaga Palms used cold-call techniques to sell shares using UK listed telephone number to fool their victims.
Halfon had long privileged Gibraltar, a paradise for every kind of scam imaginable, using it as a base for managing the funds that flowed into his diverse business operations, benefiting from its advantageous financial services legislation. He, as many others, used a European Union mechanism which permitted firms authorized to provide financial services in one jurisdiction, to provide those same services in another jurisdiction, without the need for authorisation in the second jurisdiction. Thus, Halfon’s Gibraltar incorporated firms, were authorised to provide banking, investment and insurance services throughout the EU, since Gibraltar was part of the EU by virtue of the UK’s membership.
Chapter 55 MOSCOW
Barton checked the website of Gambia River Minerals and found downloadable company reports including: geological surveys, maps, details of concessions and letters from ministers. The site was well designed and convincing. A little more research showed that Gambia River Minerals was the clone of an FSA authorized company.
He remembered meeting one of Halfon’s partners in the Basque Country, David Jameson, a Londoner, whom he had instantly recognised as a conman. It was evident Halfon was running a well-organized boiler room scam, like so many others found in the murky corners of financial markets and especially in the mining and property businesses. What always surprised Barton was how gullible investors fell for such scams; the answer was as always to do with cupidity, the lure of easy gains.
Halfon’s mail gave the impression his company, BRIC Securities, was based in the UK. In reality it was nothing more than a £100 off-the-shelf Gibraltar company, though its letterhead announced a prestigious address on Aldersgate Street in the City of London.
The director of the Senegalese company was listed as a certain David Kessler. The name rang a bell. Kessler had been arrested on suspicion of fraud related to online financial services for FOREX trading, stocks, futures and options. The fraudster had narrowly escaped jail by absconding after being remanded on bail pending further investigations, resurfacing some months later at an investor’s conference in Dakar, where he met and teamed up with Halfon.
Kessler reported, ‘We are confident our concession will prove to be one of the Senegal’s most important deposits of precious metals. Our plans are to start production in 2013.’
Their objective was to raise twenty million pounds from investors by pressurized selling, then using offshore structures to launder the funds. With Kessler’s experience and know-how combined with Halfon’s cunning, they set-up a network of offshore front companies in Gibraltar, Switzerland, Andorra, Hong Kong and Dominica. Salesmen were hired and trained in pressurized selling techniques; their plan was simple, if the story was repeated often enough they would end up snaring enough naïve investors to finance Halfon’s crooked business plans.
As funds rolled in, the partners in crime diverted the funds to expanding their business into Spain, where they could take advantage of endless opportunities offered by an ever increasing number of distressed property firesales. They bought homes and apartments at knockdown prices, transferred them to an offshoot of Malaga Palms, then resold them to Russian and other inexperienced punters via websites and high pressure selling.
They worked in the knowledge that the FSA and overseas authorities would take years to unravel the web. They dismissed any thought the EU fraud investigation agency, Eurojust, could catch-on to their game; it was submerged under a mountain of complaints from investors who had lost their money in the financial crisis.
They built a legitimate façade of brokers to peddle shares in the mining company, used genuine companies to keep accounts. Real mining engineers were employed to carry out surveys and prepare reports. There was talk of flotations, but in reality Halfon and Kessler siphoned off the capital raised, announcing, from time to time, rescheduling pending the receipt of suppliers tenders for machinery and production plant.
From a legitimate call centre in Dakar, their skilled expat salesmen sold shares issued by subsidiaries companies of Gambia River Minerals and Malaga Palms. Their holding in Gibraltar banked investor capital, which was siphoned off to various accounts in the Caribbean.
It was a classic boiler room style company with its unregulated offshore financial structure using high-pressure sales techniques to sell shares in high-risk companies at inflated prices.
In the UK, it was illegal for any person or firm to provide investment advice or to arrange investments unless authorised by the FSA. Fraudulent offshore investment firms such as Halfon’s Gambia River Minerals or Malaga Palms used cold-call techniques to sell shares using UK listed telephone number to fool their victims.
Halfon had long privileged Gibraltar, a paradise for every kind of scam imaginable, using it as a base for managing the funds that flowed into his diverse business operations, benefiting from its advantageous financial services legislation. He, as many others, used a European Union mechanism which permitted firms authorized to provide financial services in one jurisdiction, to provide those same services in another jurisdiction, without the need for authorisation in the second jurisdiction. Thus, Halfon’s Gibraltar incorporated firms, were authorised to provide banking, investment and insurance services throughout the EU, since Gibraltar was part of the EU by virtue of the UK’s membership.
Chapter 55 MOSCOW