Sentencing for boiler room fraud

What is the sentence for boiler room fraud?

One of the most recent boiler room fraud cases involved Michael Nascimento. Along with several others, he conned investors into parting with thousands of pounds to purchase fake shares in Madeira. One investor paid out over £992,000 for shares in a property development company.

boiler room fraud

Boiler room fraud is typically executed using a trained telesales team that sells shares in fake companies to investors. The businesses are designed to look like authentic companies, and quality marketing materials and websites are set up to present a genuine-looking shell.

Now that the UK government are coming down harder on regulators, they are keen to challenge any malpractice in the financial services industry. When they find individuals who are defrauding people to make a financial gain, they won’t hesitate to prosecute. Whether it’s mortgage brokers, intermediaries or small-time stockbrokers, they are keen to weed them out of the system.

If you’ve been involved in or accused of boiler room fraud, and you haven’t wittingly done anything wrong, it’s vital that you seek the help of a legal advisor.

To help you to understand what the outcome might be as a result of being convicted of boiler room fraud, we’ve detailed the sentencing guidelines below.  Please note that a competent and experienced solicitor may be able to get any prison sentence reduced or even avoid it entirely.

More about boiler room fraud

With boiler room fraud, it’s typical that investors will lose all of the money they have put in. The sales tactics are usually high pressure and filled with promises of exceptionally high returns. The estimate of the average boiler room fraud loss per person is around £20k.

Marketing agents and other members of staff are given key responsibilities to operate the boiler room fraud mission. Website development for credibility, cold calling potential investors and sending out brochures,  are all tasks involved. This role requires close contact with the coordinators and owners of the Boiler Room and exposes agents to the risk of prosecution.

Have you been charged or arrested for Boiler Room Fraud?  

Being accused of any offence naturally makes people feel worried. It’s natural to feel concerned that imprisonment will be on the cards and an inability to provide for dependents. It’s also very worrying to think about what having a criminal record can do to a career.

What type of actions are considered Boiler Room Fraud?

Here are some examples of boiler room fraud that may have led to the situation at hand.

  • Shares in a company – for example, promises of fabulous returns will encourage an investor to buy anywhere from thousands to millions of pounds of shares. Often it’s life long savings, property or a retirement fund that gets spent on shares that never materialise. The commodities involved might be petrol, fuel, gold or oil. The investor may even receive share certificates to ensure the credibility of the shares is protected.
  • Development land –for instance, promising that a piece of land will be get planning permission and will increase its value by vast amounts, the innocent investor could lose a large amount of money.

What is the average sentence for boiler room fraud offences?

An boiler room fraud case that reaches court and secures a conviction is likely to get a prison sentence of at least four to five years. The penalty may even be ten years or more, depending on how severe the crime is.  In most cases, the time will be reduced with some of the sentence being spent back in the community but on license. During this time, the convicted would not be able to offend again, or they would return to court to be resentenced and may spend further time behind bars.

How does a court decide on the seriousness of the boiler room fraud offence for sentencing purposes? 

The information that judges are given with regards to sentencing are only guidelines, and each case will be looked at individually. One of the factors judges consider in every case of this nature is the defendant’s level of genuine remorse, the seriousness of the crime and the amount of harm caused.

The following factors are considered when the court decides which sentence to give. They will look at:

  • Your previous conviction
  • The number of victims involved
  • The amount of money involved
  • Whether there was a forgery or identity fraud used to secure more funds

What are some of the mitigating factors that might reduce the boiler room fraud sentence?

Certain aspects of a case are known as the mitigating aspects which can influence the sentence that a judge gives. In boiler room fraud cases, they may include:

  • Whether the defendant is disabled or mentally ill
  • The age of the defendant, i.e. if they are particularly young, their age may affect their level of responsibility
  • If there are previous, relevant or recent convictions
  • Suspect shows a considerable degree of genuine remorse
  • If you are considered to have previous good character with exemplary conduct
  • If there is a learning disability or mental disorder linked to this offence
  • There have been demonstrative steps made to address this behaviour

Is it possible to reduce a sentence for boiler room fraud with a guilty plea?

In recent years, several changes have been made to the sentencing system in the UK to save the court time and cost and to protect witnesses from the stress of needlessly going through a trial. For offenders aged 18 and over, pleading guilty early on in a case can reduce a sentence by as much as one third (maximum). The later the plea is entered, the smaller the reduction.

‘Early on’ refers to ‘the first stage of the proceedings’ and means anytime up to and including the first hearing at the Magistrates Court or Crown Court for indictable offences.

If a plea is entered 14 days after the first hearing, for example, the maximum level of reduction is just 20% or one-fifth of the sentence. For indictable offences, the limit for a guilty plea to be made is within 28 days after the prosecutor has stated compliance with section 3 of CPIA 1996 and serving disclosure; although the decision is ultimately in the hands of the Judge who has discretion to apply whatever credit is deemed appropriate.

After these times there is a sliding scale of credit applied. This goes down to one-tenth on the first day of the trial and to zero if entered during the course of the trial. In theory, the ten per cent could be given if the plea is issued after the opening speeches on the first day, but prior to any witness evidence being heard.

If the accused does not want to plead guilty, then it’s important for the solicitor to regularly inform the court throughout the trial of the reasons why the client’s plea is not guilty.

What are some of the other consequences of a boiler room fraud offence?

Ancillary Orders

A court can also make ancillary orders on a defendant if they are found guilty and convicted of a boiler room fraud offence. These are extra elements of punishment that can be added to a sentence and include additional restrictions or requirements that can affect a dependent’s finances, your property or business or financial activity.

Ancillary orders that are typically added to the penalty for those who are found to be guilty of boiler room fraud include:

  • Compensation for loss
  • Restraint orders
  • Reparation orders
  • Financial reporting order
  • Disqualification from directing a company
  • Confiscation orders
  • Victims’ surcharge

As part of your investigation, you may also have your assets frozen with the possibility of having cash or other assets seized.

In addition, the court may demand payment of the following if the accused is convicted:

Payment of costs applied for by the prosecutors

Although the police meet some of the costs involved in the prosecution, the costs of investigation are typically sought from the convicted. These may include the costs of:

  • The work done in obtaining enough evidence for prosecution either at the initial stage or later at the request of Crown Prosecution Service (CPS)
  • Seeking medical or expert evidence as part of the investigation, (where a witness is required to attend Court, the cost of the attendance falls on the CPS).
  • Re-interviewing witnesses
  • The entire costs of the prosecutor, including fees for the use of external Barristers used by the CPS, can be recovered from the defendant, subject to means. At the end of the case, the prosecutor under The Prosecution of Offences Act 1985 will request the Judge to order a sum to be paid for the costs incurred by the prosecutor in bringing the prosecution.

Victims surcharges

The term victims’ surcharges can be explained as paying compensation to a fund for victims and can range between £20 to £170 depending on what sentence you were given at conviction.

How sentences can be added to national information databases

There are several national databases that hold information about individuals and any allegations made about them, their criminal and court records. These include the DBS (Disclosure and Barring Service) which was previously known as the CRB (Criminal Record Bureau) and the Police National Computer (PNC).  Depending on what happened, whether the accused is convicted and what sentence was issued, the accused may be added to one or all these databases. Their purpose is to provide information to potential employers and to regulate the ability to take part in certain activities.

If your case progresses to court and you are convicted of boiler room fraud and defrauding the HMRC tax office, your conviction will be noted on your CRB / police record. The period of the endorsement will depend on the nature and length of your sentence.

Below are details on how long you will be listed as holding a criminal record if convicted. This is something very serious to consider when it comes to future employment. The term ‘spent’ refers to when your name can be removed from the databases.

Rehabilitation Period
(the time it takes for the sentence to become ‘spent’)
Sentence Adult (aged 18+) at time of conviction Young person (aged under 18) at time of conviction
Prison sentences of more than 4 years Sentence is never spent Sentence is never spent
Prison sentences of more than 2.5 years (30 months) but less than 4 years Sentence length 7 years Sentence length 3.5 years
Prison sentences of more than 6 months but less than 2.5 years (30 months) Sentence length +4 years Sentence length +2 years
Prison sentences of less than 6 months Sentence length + 2 years Sentence length +18 months
Conditional Discharge Length of order Length of order
Absolute Discharge None None
Conditional Caution 3 months 3 months
Simple Caution / Youth Caution None – immediately ‘spent’ None – immediately ‘spent’
Other Including Compensation Order, Supervision Order, Bind Over, Hospital Order Length of the order / once compensation is paid Length of the order / once compensation is paid

Have you been arrested or charged with boiler room fraud?

If you’ve been contacted by the police and arrested, charged or even just invited to the police station for a chat, it’s vital that you seek legal guidance immediately. Communicating in any way with the police without legal support can put you at significant risk of being given a term in prison.

The primary goal of the police is to secure convictions. They do this by trying a range of different approaches and techniques in a bid to get you to incriminate yourself. They will not disclose all the evidence that they have against you and are going to use as part of their prosecution.

Some evidence is likely to be withheld from your knowledge or vision, but by having an experienced investment fraud legal expert by your side, you can give yourself some protection against the police and their tactics.

Another benefit of engaging competent and experienced boiler room fraud lawyers is that they can provide you with guidance on what to say and what not to say. The police will ask you many questions, and this can be gruelling and exhausting. With a legal professional by your side, you can answer confidently, knowing that you’re not getting yourself into deeper and hotter water.

Your solicitor can immediately begin to create a robust defence strategy to secure you the best possible outcome should your case reach court. Alternatively, your solicitor may even be able to get your case dismissed before it reaches the court stage.

If there are other people involved who have been accused and are involved in your case, it’s vital that you know what’s being said by whom. Accessing this information isn’t always possible, but there is a good chance that your lawyer will be able to make contact with the other legal help involved in this case to minimise damage.

How Can Stuart Miller Solicitors Help?

The fraud lawyers of Stuart Miller Solicitors are known for having defended those accused of these boiler room fraud-related schemes at all levels. Whether you are accused as the mastermind, the second in command, the marketing assistant, the IT assistant or the floor-operator required to deal with customers; Stuart Miller Solicitors have substantial expertise in understanding your specific case, your particular circumstances and the way in which the prosecution will seek to prosecute you.

Given the nature of these schemes, often those involved are unable to disclose the way they sought a return on investments. If such information was disclosed, the scheme could never get off the ground, it couldn’t operate, and competition would move-in to monopolise on the unique nature of the investment proposed.

One of the most vital elements required for a robust defence strategy of this type of scheme is an explanation of how the scheme is legitimate and able to make money. There needs to be evidence of reasonable due diligence being applied so that the scheme is not only honest but legitimate. Our defence lawyers will proactively pursue all evidence to support your case so that you get the best possible outcome.

Owing to daily handling of fraud cases, inclusive of investment fraud cases, our fraud solicitors have the very best Barristers and QCs to choose from. We can instruct international agents to make enquiries abroad; we can engage financial experts to analyse the trail of funds, we can work with telephony experts and computer evidence evaluation experts to build your defence case. We also have a wide network of other expert witnesses who can help us to develop a robust defence strategy.

Our reputation is significant, but here at Stuart Miller Solicitors, we also rely on past notable cases to showcase and demonstrate our remarkable abilities in this field.

Would you like to discuss your case before instructing us?

If you’d like to have a no-obligation chat with us before you instruct us to take your case, then call us today.  In addition to giving you a free consultation, we can also represent you at the police station if you’ve been arrested. We can look at securing your legal aid.

Please Contact Us and ask to speak to our boiler room fraud lawyers and fraud offences solicitors to arrange a meeting in person, online or by telephone. If you prefer, you can WhatsApp us from the link you will find at the bottom banner if you open this page on your mobile phone device.

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