Radio 4’s Anatomy of a Fraud: Featuring World Commodity Trading, Heritage FA, Eco-Synergies, IGL Labs UK, Diffraction Diamonds DMCC, Diffraction Limited, Citadel Trustees

and World Gemological Institute

In November 2019, Radio 4’s File on 4 broadcast a programme titled, “The Anatomy of a Fraud”. It documents in detail how 86 year-old Cynthia Tuck was scammed into handing over almost £400,000 in fraudulent investment schemes. And how the authorities and police have utterly failed her.

Cynthia was first conned into spending £5,000 on an investment in carbon credits. When she tried to sell the carbon credits, she found she couldn’t.

“I had an awful telephone call from some chap who was just so rude, and so unpleasant because I wanted to sell this certificate,” she told File on 4. “I came from the phone literally shaking. He was so rude and he was so horrible.”

In January 2013, she got a call from Colin Moore at a company called World Commodities Trading. “He was absolutely lovely,” Cynthia said. “He sounded really genuinely upset for me, very sympathetic, which is just what I needed after this phone call from this other chap.”

Moore rang Cynthia again a few weeks later and told her had sold the carbon credits, for a bit more than £5,000. Moore asked whether she wanted to reinvest the money.

“And then he said, ‘You know you like to invest money for this grandson that’s going to university, then offered me this pink diamond that was going to be worth £2,000 more by the time my grandson would come in and out of university.”

So Cynthia agreed.

A few months later, Moore rang again. He said he had a client who would like to buy the pink diamond for £7,100. Cynthia agreed again. Moore kept ringing with more and more offers of diamonds. Each time, Cynthia agreed.

World Commodity Trading

World Commodity Trading Limited’s website was glossy, and featured quotations from Reuters and the Financial Times about investing in diamonds. Here’s what the company’s website looked like in May 2013:

The company’s address (according to the website) was 25 Canada Square, London. Cynthia visited the office:

“I went to Canada Square, where they had a whole floor, and you had to have a passport to get in. So it seemed so official, and OK. And they were on the 33rd floor. And there was Colin Moore, very smart, very personable, and we talked about diamonds.”

But in May 2014, World Commodity Trading was ordered into liquidation following an investigation by the Insolvency Service. World Commodity Trading was part of a “web” of companies that were fraudulently selling carbon credits as investments. In the High Court, registrar Clive Hugh Jones said,

I am satisfied on the basis of the evidence before me that the sale of VER carbon credits to the public on the basis that the credits will increase significantly in value would be a sale based on a fraudulent misrepresentation.

Eco-Synergies

World Commodity Trading was part of a network of scam companies, with Eco-Synergies Ltd at the centre. Eco-Synergies bought up carbon credits cheaply, sold them to related companies, which in turn persuaded the public to buy, at inflated prices, as investments.

REDD-Monitor has written about several of the companies in this network, including MH Carbon, City Asset Partnership, and Worldwide Commodity Partners Limited:

The Insolvency Service contacted as many victims of World Commodity Trading as they could find, to tell them what has happened. Unfortunately, they did not contact Cynthia. She did not know that World Commodity Trading had been shut down.

Heritage FA

Colin Moore kept ringing Cynthia. He told her that the company’s name had changed to Heritage FA Ltd. He persuaded her to “invest” yet more money on diamonds.

At one point, Cynthia even invited Moore to lunch at her home. When Moore told her his daughter was in hospital, Cynthia bought a present and asked Moore to give it to her.

In May 2015, Moore told Cynthia he had the most valuable diamond so far. It was a blue diamond, and it would cost £45,000.

Moore claimed to have a buyer in Hong Kong who was interested in buying all of Cynthia’s diamonds. But he wanted this last one. Then he would buy all the diamonds for $495,000, Moore said.

Cynthia handed over the last of her life savings, plus money she had borrowed on an overdraft. In total, she bought 21 diamonds for nearly £400,000.

Cynthia began to worry. She wrote to the Insolvency Service to tell them about her experience with World Commodity Trading and Heritage:

Very lucrative deals kept coming up, with the result that I bought more diamonds. But these deals were postponed, or fell through, for what seemed very good reasons. A really big deal was supposed to be happening around Christmas time, but when it didn’t come off, I really began to smell a very big rat.

In March 2016, Heritage was ordered into liquidation, following an investigation by the Insolvency Service. The investigation found that the company had conned retail investors into handing over £7 million.

The Insolvency Service did contact Cynthia about Heritage. But by then, all her money had gone.

IGL Labs UK

Each time Cynthia bought a diamond, she received a certificate with details of the investment. The certificates helped reassure her that the investment was genuine. BBC News has posted one on its website:

File on 4 showed the certificate to Alan Cohen, the President of the London Diamond Bourse. “That’s a bit strange,” he said. “This estimated retail value, I don’t know where they would have got that from. What’s the mark-up that they’ve decided is the regular mark-up for an estimated retail value? Have they doubled it? Have they tripled it? I really don’t know.”

When told that the certificate was given to a first-time investor in diamonds who is in her 80s, Cohen shook his head. “That’s dreadful,” he said. “That’s absolutely dreadful. We don’t sell diamonds as investments. We’re not regulated by the FCA. This is blatantly misleading. Well, it’s a blatant con.”

In June 2017, the company that produced the certificates, IGL Labs UK Limited, was wound up in the public interest. IGL did not even see some of the diamonds it was appraising. IGL’s estimated retail valuations were calculated simply by adding 20% to the price paid by the investors. IGL also sometimes upgraded the diamonds above the grading provided by the authentic certificates from the Gemological Institute of America.

Diffraction Diamonds DMCC

Another company, Diffraction Diamonds DMCC, was also wound up at the same time as IGL Labs UK Limited.

Diffraction Diamonds DMCC was based in Dubai, and according to the Insolvency Service, “was at the centre of a scheme to sell fancy coloured diamonds to investors, via numerous broker companies based in the United Kingdom”.

The man behind Diffraction Diamonds DMCC, David Ramsey, was also behind a UK registered company called Diffraction Limited. In June 2014, Diffraction Limited was closed down in the High Court.

There’s no doubt that Ramsey is persuasive. Here he is talking to Reuters in 2011 about diamonds as an investment (this video is edited to focus on the parts where Ramsey is talking):

Maybe, just maybe, Reuters should have known better than to describe diamonds as “a risk averse investor’s best friend”.

Diffraction Limited was another company in the web of companies around Eco-Synergies. Eco-Synergies bought carbon credits for an average of 65 pence, and sold them to Diffraction Limited for an average of £1.11. Diffraction Limited sold the carbon credits to the public for an average of £4.81.

In eight months in 2012, Diffraction Limited persuaded people to part with more than £1.3 million for massively overpriced carbon credits. 

Citadel Trustees

The carbon credits that Diffraction Limited sold were held by Citadel Trustees. Diffraction Limited used the fact that Citadel Trustees was registered by the Financial Conduct Authority to reassure people that this was a legitimate investment.

In the High Court, Registrar Christine Derrett  said, “customers were referred to Citadel’s FCA registration, which offers the customer no protection as trading in carbon credits is not a regulated activity”.

One of the directors of Citadel Trustees, Anna Rickard, was also a director of Eco-Synergies Nominees, another part of the £19 million Eco-Synergies web of fraud.

World Gemological Institute

While the UK company IGL Labs UK Limited has gone, the parent company IGL is still up and running.

File on 4 phoned the company in Israel. IGL explained that the owner of the UK franchise, “did things that he shouldn’t do, and then we shut down his system. His name is Noam Lenzini. We made a mistake with him.”

Lenzini is now running another company, World Gemological Institute, from the same address as IGL Labs UK Limited:

The company was registered in the UK, as WGI Ltd, in July 2019.

Lenzini did not respond to File on 4’s questions by email. When File on 4 visited his office in Hatton Garden in London, they spotted him on the street. File on 4 asked whether he knew that his certificates were used to defraud people of their life savings. “I never sold anything,” he said and walked away.

The police’s response: Pass the parcel

On 1 February 2016, Cynthia’s daughter Rachel phoned Action Fraud.

A policewoman from Rachel’s local police force turned up at Rachel’s house “quite late one Saturday night”. The policewoman told Rachel what she already knew: her mother had been the victim of a fraud. The policewoman said she couldn’t do anything about it, “because it’s not our remit”.

Action Fraud passed the case on to the National Fraud Intelligence Bureau at the City of London Police. The City of London Police passed the case on to the Metropolitan Police because the company was operating in the Metropolitan Police’s jurisdictional area.

Durham Police were also involved. In Spring 2017, they referred their investigation to the City of London Police.

File on 4 quoted from documents it has seen from Durham Police summing up their investigations so far:

47 Action Fraud reports have been submitted in relation to this fraud. Of these, 32 people have reported that they have lost money to this investment fraud. Further potential victims were identified by Durham Police. As a result of the enquiries conducted by Durham Police 11 statements have been obtained, and documentation and notes provided by another 22 victims. Total loss by these individuals is £2,265,234.76.

Nine months later, towards the end of 2017, the City of London Police declined the referral from Durham Police. “After careful reviewing it was determined that the case could continue to be investigated by Durham Police,” City of London Police stated. They did not reply to File on 4’s questions about why it took so long to hand the case back, or how many victims they had interviewed.

In 2018, Sussex Police, Cynthia’s local police, got involved. But Sussex Police didn’t work on the case for long.

Home Office rules state that when there are many potential victims in different places, the overall responsibility lies with the police force where the scammers are based.

Back to the Metropolitan Police, then.

In Spring 2019, the Metropolitan Police told Rachel that they couldn’t continue the investigation, “because they couldn’t prove that Moore knew that he was telling lies”, Rachel told File on 4. “Even though they knew that he knew, they said it would be very difficult to prove that.”

The Metropolitan Police told File on 4 that their “central specialist crime unit led a complex investigation, but that the case failed to meet their ‘evidential test’. The investigation had been reviewed three times, and in each case the decision not to investigate further was upheld.”

File on 4 spoke to Tamlyn Edmonds a partner at the law firm Edmonds Marshall McMahan. Edmonds said,

“In this particular case, we’re looking at fraud by false representation. So it’s basically a false representation made dishonestly with the intention of inducing somebody into financial loss or exposing them to the risk of a financial loss.

“I cannot understand based on the information that I have, why this has not proceeded as a full investigation. Now, again, I don’t know what the Met actually did, whether the Insolvency Service have handed over all the records to the Met. It doesn’t look like, certainly in relation to the particular witness we’re talking about, that she has actually been spoken to in detail by the police.

“It doesn’t look like any of the employees of this particular organisation were spoken to. The City of London Police from the information that I have seen kept a record of all of the people that they saw there on a particular day, photographs were taken, names and addresses. Have any of those people been spoken to? Because that’s usually your first port of call, to lead you up higher in the chain.”

The diamonds were worth a fraction of what Colin Moore told Cynthia they were worth. In some cases, the diamonds didn’t even exist.

“I felt terribly guilty,” Cynthia told File on 4. “This was money that was destined for my children and my grandchildren.”

Cynthia’s family has not been able to track down all the diamonds that Cynthia paid for. They got some, and sold them, after finding out the true value from experts at the London Diamond Bourse.

Cynthia got back less than 10% of what she paid.

File on 4 tried to contact Colin Moore, but could not track him down.

No one has been arrested, charged, or taken to trial in this case.

File on 4 notes that according to the latest figures from the Crime Survey for England and Wales, published in October 2019, 3.9 million fraud offences took place in the past year. That’s an increase of 15% compared to the previous year.

---