A FRAUDSTER, originally from Basingstoke, has been jailed for selling sake shares and running a false betting scheme.

David Dixon, 49, set up a Ponzi fraud, inviting friends and fellow gamblers to pay into the “pots” of an arbitrage betting scheme and invest in shares, incurring a total loss of £3.3 million.

As The Gazette has previously reported, several of the victims were from Basingstoke, including one man who lost some £150,000. Up to 600 investors were conned in total.

Dixon used the money he fraudulently made to fund his own habit and support an “extravagant” lifestyle which involved jetting off to Malaysia and other exotic locations such as the Seychelles.

He was described as “carnally dishonest” yesterday during his sentence hearing at Southwark Crown Court in London, where he was jailed for three years and 10 months.

The court heard that Dixon practised two deceits - the first involved persuading friends that arbitrage betting offered the prospect of huge returns with no risk of loss, and the other was that he himself continued to be “immensely” successful in the scheme, which he started in 2003 after being released from jail in July 2000, following his conviction in 1998 for fraud offences.

Prosecutor John Hardy QC said: “The total losses accounted for in this fraud amount to just under £3,380,000.”

Describing the largest part of the fraud, he added that it was a classic Ponzi scheme, “with a proportion of the investments made by new investors used to pay out some of the more long-standing investors”.

“The payouts served to both delay the inevitable moment of realisation on the part of the recipients that they had been defrauded, but also ‘spread the word’, in the sense that those who received payouts would mention their success to family, friends, and colleagues at work, and thereby create new generations of investors who would also become the victims of the fraud.

“The evangelic effect of the payouts was to persuade other investors that the scheme was foolproof,” said Mr Hardy.

Dixon initially ran the scam, which involved investors believing themselves to be part of a syndicate, from a pub car park in Thatcham, Berkshire. But before long news of the scheme had spread and Dixon expanded the operation.

In late summer 2004 he set up an office in Dummer, where he hired staff whom he also conned.

Dixon also provided the enterprise with a “corporate veneer” by setting up a company under the name of Arboretum Sports USA (ASI) in Nevada, and “grandiosely” giving himself the title of director and president.

The court heard that although he could be persuasive and charming at times, Dixon could also be a “malevolent bully”, sending emails to investors who had asked for their money back, labelling them “greedy”.

Sentencing Dixon, Judge Alistair McCreath said the loss to the victims was more important than what Dixon had done for himself with the money, and that he had taken into account the fact that any time spent on licence in the UK would be time spent away from his partner and children in Malaysia.

Dixon admitted one count of dishonestly concealing a material fact, three counts counts of making a statement, promise or forecast known to be misleading, false or deceptive, and one count of fraud by false representation, all between 2004 and 2007.

Originally from Basingstoke, Dixon was extradited from Malaysia following a joint investigation between the Serious Fraud Office and Hampshire Constabulary.

He was declared bankrupt in August 2000, and three years later was discharged from bankruptcy, whereupon he began talking to friends about his involvement in arbitrage betting.