US Mafia link to scam on investors
Ulster business chiefs lose thousands to fraudster
Published 16/07/2007 | 10:43
More than a dozen Ulster business people have been caught up in a multi-million pound scam that targeted British and Irish investors hoping to make money from the US war on terror, the Belfast Telegraph can reveal today.
The head of the scheme, New Jersey fraudster Mario Figueroa, declared bankruptcy this month after living it up at the best Belfast hotels, where he boasted about his mansions and luxury yachts while luring people into the scheme.
Victims include the managing director of a Lisburn engineering company, a director of a Londonderry property company, the owner of a Strabane garden centre and the owner of a Belfast electrical shop.
The FBI suspects Mafia involvement in the scheme, which employed 30 salesmen working from central New Jersey and took in over $50m.
Figueroa admitted travelling many times to London, Dublin and Belfast to entice investors and based his business solely on UK and Irish investors.
The defence companies he invested in were supposed to be major suppliers of Tomahawk cruise missiles and armament parts to be used in Afghanistan and Iraq.
In reality, some were little more than shell companies designed to lure investors.
Figueroa led a lavish lifestyle, buying a $2m house, a Mercedes Benz sports car and a 62-foot yacht called Private Enterprise, all of which have now been seized by the New Jersey Attorney General's office.
One investor from the province, Frank Sumner, owner of the Strabane Garden Centre, was one of the few investors to get off lightly, losing about £6,000 to the scheme.
Mr Sumner said that the Clover group had phoned him at work and promised he could make vast sums from their investment scheme.
He recalled that Figueroa told him that he was coming to Belfast to meet businessmen who were prepared to put large sums of money into the scheme.
"He didn't bother coming to see me, I was just small fry compared to some of the people he was looking for," Sumner said.
Mr Sumner said he had invested in a defence contractor called Invatech, which the federal prosecutors in New Jersey have identified as one of three " poorly performing" companies into which victims' money was placed.
In a criminal complaint lodged in court, prosecutors say that investment money from one defence company, JCM, was used to pay off irate Invatech investors, while telling them that this money was "profit" from their investment.
Many Invatech investors were so impressed they poured hundreds of thousands of dollars more into the scheme.
Sumner said that he hoped that a "slimeball" like Mario Figueroa be brought to justice "for the sake of people that have lost a lot" .
"I don't care if I don't get anything back," he said.
Figueroa has already pleaded guilty to racketeering and money laundering and is due for sentencing in September.
He is currently working as a Manhattan mortgage broker, earning $16,000 a month.
According to court records, there are at least 13 Northern Ireland investors so far identified, many of them directors of companies involved in property, engineering and electronics.
They include Edward Nicell, director of Cara Development Ltd, a property investment company in Derleen Park in Derry; David Neil of Express Distribution Services in Craigavon, and Leslie Millar, the managing director of Rocklyn Engineering in Lisburn.
Other investors include Rufus McClelland of Calverts Tavern in Armagh city; Russell Kelly of Beechfield Court in Coleraine; Brian Caldwell of Kingsgate Street, Coleraine; Robert McClurg of Saintfield Road, Ballynahinch; Trevor Calderwood, with an address listed as "Unit 5" in Ballymena and Michael Loughran of Churchtown Road in Cookstown.
At least three UK investors lost over $1m each and have hired a New Jersey attorney to win their money back.
Scotland Yard believes that there may be other UK and Irish investors who have not come forward because of fear of tax implications.
One London investment company which is listed as a Figueroa creditor at least five times because of various investment schemes, was fined in 2005 for failure to prevent money laundering, the first company to be fined under UK anti-money laundering laws.
UK investors included a senior civil servant, Grant Ballantine, a consultant on state pension policy at the Government Actuary's Department.
Mr Ballantine, who lost over $100,000, said that any money that is returned to investors would be a "drop in the bucket" compared to the amount invested.