UK ponzi scheme took in £14m savings from 350 victims

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To his clients, Terry Freeman had all the trappings of a multimillionaire City of London trader with a reputation for risk-free currency investments.

As well as holiday homes in Cyprus and France, his wealth had bought him a top-of-the-range Land Rover, an executive box at Tottenham Hotspur and a £120,000 ($248,000) ring for his third wife.

The true source of the 62-year-old's profligate lifestyle was revealed in a south London courtroom yesterday when he pleaded guilty to running a Ponzi scheme that defrauded about £14 million from some 350 victims who were taken in by the bankrupt businessman's plush City offices and promises of unbeatable returns on their money.

Victims, who ranged from a roofing company owner who invested his £600,000 life savings to footballers and the ex-wife of golfer Colin Montgomerie, were shown paperwork from Freeman's company, GFX Capital, which showed their investments doubling or tripling in value - when in reality he was frittering away millions of pounds on botched trades and the toys of a tycoon.

The single biggest losers from Freeman's fraud were a couple who handed over £1.4 million, including their family home. Investment updates suggested their capital had risen in value to about £2.7 million, but by the time the authorities caught up with the conman they had just £15,000 left in their account.

The extent of Freeman's deceit was only revealed in 2008 when he gambled on a bailout for the US investment bank Lehman Brothers and bought large numbers of dollars.

When the bank collapsed, the dollar plummeted and GFX Capital, which operated from offices in Broadgate costing £14,000 a month in rent, was no longer able to conceal its empty coffers.

As clients began to withdraw their funds, Freeman, who lived in a £500,000 house in Buckhurst Hill, Essex, with his 30-year-old Russian bride, approached police claiming he was being threatened by investors and admitted to losses of about £20 million.

His victims claim the losses from GFX Capital could be as high as £44 million.

Detective Superintendent Bob Wishart, who led the investigation, 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." He will be sentenced next month.

- INDEPENDENT