Former Fox Hayes partner stands trial for alleged boiler room scam
THE trial of a Yorkshire lawyer charged with corruption in relation to the sale of shares to UK investors has begun.
John Robert Manning, a former senior partner at Fox Hayes Solicitors, the Leeds-based firm which went into administration in January 2009, is being tried at Southwark Crown Court in relation to a single allegation of corruption contrary to section 1(1) of the Prevention of Corruption Act 1906.
The Serious Fraud Office’s (SFO) prosecution alleges that from 2003 to 2007, sales entities operating from Madrid sold shares in US listed companies to a large number of UK investors fraudulently.
All the shares sold that are the subject of the SFO’s indictment had restrictions on their resale for a 12 month period.
The SFO alleges that many of the investors were unable to sell their shares after the expiry of this period as they were worthless and that the shares were in shell companies, companies that were not operating at all. It is alleged that a total of US$108m and £6m were obtained from UK investors as part of the fraudulent scheme.
The SFO alleges that Mr Manning received US$869,407 for arranging for and continuing to allow Fox Hayes Solicitors to promote the work of the Spanish sales entities and to receive investor funds from the sales.
Mr Manning is standing trial along with Jeffrey Revell-Reade and Anthony May.
A further part of the SFO case alleges that Mr Revell-Reade directed corrupt payments to Mr Manning in return for which Mr Manning arranged for and continued to allow Fox Hayes Solicitors to be used during 2003 and 2004 to promote the work of the sales entities and to receive investor funds from the sale of the shares.
Mr Revell-Reade is an Australian national who is being tried in relation to an allegation of conspiracy to defraud and an allegation of corruption contrary to section 1(1) of the Prevention of Corruption Act 1906.
The SFO alleges that between 2003 and 2007, Mr Revell-Reade set up the scheme by which the shares could be sourced and sold through the Madrid sales entities and controlled the process by which the funds obtained from investors were distributed through a myriad of off shore companies. The SFO also alleges that Mr Revell-Reade directed the corrupt payments to Mr Manning to ensure that Fox Hayes both promoted the work of the Spanish sales entities and received investor funds.
Mr May, a UK national, is being tried in relation to one allegation of conspiracy to defraud. The SFO alleges that Mr May administered the processing of shares distributed to investors and managed the finances of the conspiracy, using and managing a myriad of off-shore bank accounts to distribute the funds obtained as part of the conspiracy.
All three defendants deny any wrongdoing and have pleaded not guilty.
The trial continues and is expected to run for around 10 to 12 weeks.
