A rogue property developer who conned investors out of £13 million through a Ponzi scheme has been disqualified from being a company director.
Mitchell Mallin, 34, from Chelmsford, ran Essex and London Properties Limited, which targeted investors by promising that their funds would be used to buy dilapidated houses in London and Essex before renovating them and selling them for a profit.
It raked in more than £13 million over three years from hundreds of people who stumped up between £5,000 to over £100,000. However, only one £147,000 property was ever bought for renovation and instead the majority of investors’ money was siphoned to overseas bank accounts.
The company was wound up in September 2018 following an investigation by the Insolvency Service.
14 year ban
Mallin did not dispute that he caused or allowed his firm to trade with a lack of commercial probity and has now been banned from acting as a director for 14 years which means he cannot become involved in the promotion, formation or management of a company.
Property Tribes originally flagged up the story in 2018, reporting that many investors were approached directly or via intermediary platforms, enticed by offers of an 8% annual return paid quarterly if the money was held for three years or 12% if the money was held for one year.
Neil North, chief investigator at the Insolvency Service, says: “As the period of disqualification reflects, obtaining funds from investors and using them in a dishonest manner is a serious matter and contrary to the conduct expected of a company director.
Companies have limited liability, which is a privilege, not a right and we have strong enforcement powers which we will not hesitate to use to remove that privilege from dishonest or reckless directors.”