Two fraudsters who raked in more than £400,000 by selling a cryptocurrency that did not exist have been jailed.
Ross Jay, 33, and Michael Freckleton, 37, cold-called victims to sell them shares in Digi Ex, promising them profits from a rising-star in the crypto world called Telecoin.
The currency did not exist and the two men made no efforts to invest the money in the digital world, instead paying themselves large salaries and draining cash from the Digi Ex business.
City of London Police said £509,599 was deposited into Digi Ex between 2015 and 2017, with £409,493 traced back as payments from investors.
Jay, from Northcote Road in Sidcup, and Freckleton, of Parkmore Wilderness Road in Chislehurst, were both convicted of conspiracy to defraud, at the end of a five-week trial.
At Southwark crown court on Friday, Jay was sentenced to six years and three months in prison and Freckleton was jailed for six and a half years.
“It’s easy for investors, and sadly victims in this case, to be sucked in to what they think is an area of potential and growth for their hard earned cash due to how new the area of crypto investment is”, said Detective Inspector Lee Parish, from the fraud operations team at City of London Police.
“Jay and Freckleton exploited this mindset and knowingly chose to simply take the victims’ money for their own financial gain, with no intention whatsoever of providing a service that even resembled a credible investment.”
Police said Jay and Freckleton “siphoned money for personal gain without providing any credible investment services”, including paying more than £139,000 in salaries and withdrawing £145,000 in cash.
“The sentencing should serve as a reminder to not invest in emerging currencies that have the potential to be unstable in an erratic financial market”, said DI Parish.
“Should you wish to invest money, please do your research and go with a company which is FCA registered and is recognised worldwide. If in doubt, contact an accredited financial advisor. ”
