A Wall Street broker who wined and dined clients in the House of Lords and the Dorchester has been handed a 12-year prison sentence for defrauding investors.
Ross Mandell was found guilty by a Manhattan federal court for a boiler room scam run through Sky Capital, the brokerage he listed on London’s junior AIM market.
The former cocaine addict and his associate, Adam Harrington, raised more than $50 million (£31 million) from investors — hundreds of them in Britain — and used high-pressure tactics to deter them from selling stock.
Mandell held two events at the House of Lords to drum up business after befriending hereditary peers Lord Kenilworth and Lord St John of Bletso.
Earlier in his career, he had been suspended from securities dealing in New York for six weeks after complaints from clients.
Sky Capital was listed in 2002. The company used Grant Thornton as its nominated adviser. To give the board an air of respectability, it recruited Matthew Carrington, a former MP and chairman of the Commons Treasury committee during the Barings Bank probe, and Alexander Duma, a former corporate finance head from BZW.
“Ross Mandell continuously lied, and directed his brokers to lie to investors, convincing them to make investments that Mandell knew were not what was promised,” said Manhattan US attorney Preet Bharara.
