A mastermind who ran an investment fraud scheme that defrauded victims of over £12m was jailed today for five years at Southwark Crown Court.
Jonathan Arafiena, 35, of Embassy Gardens, Nine Elms, pled guilty to one count of money laundering and conspiracy to defraud. As well as a custodial sentence, he also received a serious crime prevention order (SCPO) which will prevent him from being registered as a director of a company in the future.
Two other individuals linked to the organised crime group (OCG) headed up by Arafiena also pleaded guilty, but received suspended sentences. Ashlee Morgan, 35 of Scrutton Close, Clapham and Kofi Ofori-Duah, 44 of Grove Park, Wanstead played active roles such as money laundering and setting up landing pages and websites where victims would enter their personal details. Morgan and Ofori-Duah both answered “no comment” to all questions in police interviews.
Arafiena ran a ‘boiler room’, a term given to fraud carried on by means of distance selling, telemarketing and telesales, by which, victims are pressurised into buying products or investments on a false premise. Historically, these took place in basements or boiler rooms.
In the case of Arafiena, victims were offered investments in either commodities, traditional share dealing, binary options, cryptocurrency, and/or initial public offerings. Some were told that large returns were guaranteed, and that money can be withdrawn at any time
To date, the investigation led by City of London Police, the national lead force for fraud, has identified over 310 victims of investment fraud who together have deposited over £12m. The investigation showed that none of the victims’ money had been invested as promised.
Detective Inspector Gareth Dothie, from the Fraud Operations team at the City of London Police, said:
“Arafiena masterminded one of the biggest investment fraud cases that we have dealt with. We estimate that over £12m was taken from hundreds of victims over a two and a half year period.
“Arafiena led an extravagant lifestyle where he purchased high-end cars, luxury watches and gold bullion from the proceeds of criminal activity. Unfortunately for him, we seized all of these and he is now facing a lengthy sentence behind bars.
“We would like to remind everyone to stay vigilant to any type of investment and to follow the age-old saying that if it sounds too good to be true, it probably is. Always do thorough background checks and see if the company is regulated by the Financial Conduct Authority (FCA), as well as seeking independent financial advice before parting with any money.”
Suspicions were first raised in 2018, when numerous victims made reports to Action Fraud claiming they were unable to retrieve their investment, or even get in contact with the brokers who initially contacted them.
Analysis showed a number of bank accounts, over 50 in total, were linked to the Action Fraud reports, all of which were set up online using ID obtained from persons who allowed their documents to be used in return for a financial incentive, or victims who had previously been coerced into sharing identification documents.
The money was subsequently transferred from account to account, including crypto currency accounts and, on occasions, transferred to foreign jurisdictions such as the UAE and Lithuania. Arafiena used the proceeds of the investment fraud to purchase high-end luxury cars such as a Rolls Royce Wraith, as well as gold bullion and luxury jewellery such as a Cartier bracelet and Rolex and Patek Phillipe luxury watches – all of which were seized by officers during a warrant in 2019. These are due to be auctioned soon with the proceeds used to pay back the victims.
To help protect yourself from investment fraud:
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