Fraudster Jailed for Multi-Million Pound Betting Syndicate Scam

A man from Kent has been jailed for operating a Ponzi-style scheme disguised as betting syndicate, defrauding thousands of members out of over £44 million.

Michael Stanley, 67 from Chatham, pleaded guilty to a series of fraud offences and was sentenced today at Maidstone Crown Court to six years in jail.

Stanley was also disqualified from acting as a company director for 15 years, and a Serious Crime Prevention Order was imposed by the court to cover a five-year period, starting with the date he is released from prison.

The prosecution showed that the fraud was carried out over many years. Between 2013 and February 2019, Stanley operated the scheme under the name 'Layzey Racing Syndicate'.

The syndicate claimed to be a lay betting horse racing gambling scheme, where members invested funds supposedly for collective gambling controlled by Stanley. The scheme’s popularity grew to over 6,000 members, including friends and family of Stanley.

In reality, Stanley used new investments to pay earlier members, creating a Ponzi-type scheme.  He lied about the amount of successful gambling taking place, falsely inflated the value of investments and paid money from the scheme into his own accounts, which he was not entitled to.

Kent Police investigations found that between 2013-2019, members invested a minimum of £44.2 million in the syndicate. The scheme collapsed in February 2019 with many members making a substantial net loss. The syndicate is estimated to have made an overall net loss of at least £10.5 million.

Stanley, who served as a police officer in the 1980s, was declared bankrupt in 2019.  He benefited from the fraud to the sum of at least £4 million and misused funds to pay for his lavish lifestyle including 23 racehorses, a villa and apartment in Spain, new Land Rovers, private number plates costing £15,000 and expensive jewellery.

Rachael Barber from the Crown Prosecution Service said:  "Michael Stanley operated a massive fraud which he marketed to unsuspecting members as ‘virtually risk free’, whilst boasting of the huge profits from the syndicate. In reality, Stanley’s gambling losses far exceeded any winnings and the scheme was doomed to collapse at some point.

“When this inevitably happened in 2019, devastated members were left out of pocket and money they believed they had legitimately invested for weddings, retirement funds, medical treatment and other purposes was all gone.

“Stanley totally betrayed the trust placed in him by investors to manage their money wisely, and we are pleased to have secured justice for these victims”

Bankruptcy proceedings are ongoing against Stanley, however the CPS will be pursuing a Proceeds of Crime confiscation order to ensure any assets that may become available in the future can be recovered.

If you think you have been a victim of fraud, contact your bank immediately and report it to Action Fraud on 0300 123 2040 or online.

For more information about how to invest safely, please visit the FCA’s ScamSmart website.