Graham Hammond, former chairman of FCS Fund Management, was sentenced today to 8 years' imprisonment for a £10 million high yield investment fraud promoted by his company, FCS Fund Management.
Graham Kenneth Hammond (45), pleaded guilty on 25 May 2002 to all twenty counts on the indictment of furnishing false information.
Background
FCS Fund Management Ltd ("FCS") was an investment marketing business founded by Hammond. It had offices in Norwich, Dubai and Hong Kong. Clients were in the UK, Europe and the Middle East. Many were expatriates. FCS sold its investment products through salesmen operating in these locations though Hammond based himself in the Hong Kong office. For the high yield investments, clients were advised that returns of up to 20 % could be achieved.
On the 29th September 2000 Hammond's solicitor sent to the Serious Fraud Office a statement which had been prepared by Hammond informing the authorities of fraudulent practice and his involvement in it. He had been in effect "robbing Peter to pay Paul." The SFO in association with the Norfolk Police, commenced an investigation in October 2000. The case involved liaison with law enforcement agencies and regulators in Hong Kong. The money defrauded funded his lavish lifestyle. He opened a club in Bangkok called "Out of Bounds," was a regular at casinos and stayed at luxury hotels.
Proceedings
Hammond, who returned voluntarily to the UK for questioning, was charged on 14 November 2001 with furnishing false information between 10 August 2000 and 27 September 2000, in relation to investments held by clients in the Waidberg Currency Fund and Capital Advantage Investment Fund. Hammond knew that the Fund accounts were, or might be misleading, false or deceptive in that they purported to confirm the existence of genuine investments. The shortfalls between monies held on behalf of clients and what was stated on the statements of accounts totalled around £10 million.
Hammond pleaded guilty on 25 May 2002 to all twenty counts of furnishing false information contrary to Section 17(1) (b) of the Theft Act, 1968. In passing sentence at Norwich Crown Court today, His Honour Judge Mellor found Hammond's personal benefit to be 1.3 million pounds. He commended the work of Detective Constable Tim Kent and the Serious Fraud Office.
Notes for Editors
On 21 March 2002 the Director of the SFO Rosalind Wright warned of the increasing number of cases of this type of " Prime Bank & High -Yield Investment" Fraud. To view her speech, visit the SFO website www.sfo.gov.uk and select "Publications and Speeches" on the home page menu. Then click "Speeches archive". An explanation of prime bank guarantee fraud, with examples of recently concluded cases, are given in the speech.
Alternatively call 020 7239 7000 or 7190 for a faxed copy.
The SFO is currently investigating four cases of suspected fraud involving high yield investments. Due to operational reasons cannot be discussed.
Press enquiries: 020 7239 7190/7000. Out -of- hours mobile 07887 958 243.
A Confiscation hearing is fixed for 11th November 2002 at Norwich Crown Court.
