Director Andrew Laird Hosie had run Gambling Insight Ltd as an investment vehicle for arbitrage gambling. This was a system under which bets were to be placed with different betting companies to enable the bettor to make a profit, regardless of the outcome, by utilising the variance in “odds” offered by different bookmakers. This was facilitated by software which scanned the online betting markets to detect the bookmakers at which the appropriate bets should be placed.
He had obtained an estimated £7,161,221, from both direct investors and syndicates, under representations that the gambling of the investment monies was virtually risk free. Claims were made including that “It is a Mathematical Certainty we will win and profit TAX FREE”.
However, after the company went into Administration, practically none of the £7,161,221 has been traced, due to the inadequacies in the company accounting records.
In addition, Mr Hosie has admitted that he made a number of misleading statements to investors, or conversely failed to inform them of material events and actions:
- He continued informing new and existing investors of the low risks of the investment after losing an estimated £2.5M of syndicate money in c. February 2014.
- He failed to inform new and existing investors that he began gambling with their monies from that time, contrary to his agreement with them that arbitrage gambling would be conducted at no risk.
- He sent screenshots to investors from July 2014 which showed healthy balances on those accounts, which he knew to be untrue, and:
- He informed syndicate investors that over £1 million of investor monies were frozen in a bank account, when he knew that that too was untrue.
The disqualification prevents Mr Hosie from directly or indirectly becoming involved in the promotion, formation or management of a company for the duration of their disqualification terms.
Commenting on the disqualification, David Brooks, Group Leader at The Insolvency Service, said:
Mr Hosie promoted this investment as practically risk free. However, the truth of the matter was that Mr Hosie has lost the investors money through a combination of gambling and a failure to keep records which would show how it has been disposed of, through the thousands of gambling accounts operated by the company.
This is serious misconduct and the high period of disqualification should serve as a message that honesty and openness is an essential element of a director’s role.
Notes to editors
Andrew Laird Hosie’s date of birth is 9 August 1972 and he resides in Cheshire.
Gambling Insight Ltd (CRO No. 05025724) was incorporated on 26 January 2004 and traded from Unit 5, Fort Dunlop Fort Parkway Birmingham B24 9FD. The Company traded in gambling and betting activities.
The Company went into Administration on 23 January 2015 with an estimated deficiency of £7,512,538.
There have been a number of associated insolvencies:
- A Winding Up Order was made against Bet Butler Ltd on 08 June 2015
- A Bankruptcy Order was made against Andrew Laird Hosie on 1 June 2015
- BetClearer Ltd entered into Voluntary Liquidation on 20 October 2014
The Secretary of State has accepted a Disqualification Undertaking from Mr Hosie, effective from 24 November 2016, for 12 years. The matters of unfitness, which Mr Hosie did not dispute in the Disqualification Undertaking, were that:
- Andrew Laird Hosie (“Mr Hosie”) failed to ensure that Gambling Insight Limited (“Gambling Insight”) maintained proper accounting records, or, in the alternative, he failed to preserve or deliver up such records as were maintained. As a result the whereabouts or disposal of investment capital estimated at £7,161,221 and paid into Gambling Insight from January 2011 to September 2014 has not been ascertained.
- Mr Hosie caused Gambling Insight to mislead investors from circa. February 2014, contributing to their losses estimated at £7,161,221:
- In a weekend in circa. February 2014, Gambling Insight made gambling losses from syndicate monies it administered estimated at £2.5M. However, this fact was not communicated to either the affected syndicate, or new investors. Investors invested a further estimated £1,260,500 after that date on the understanding that the investment was practically risk-free. Those monies were subsequently lost.
- From circa. February 2014, Gambling Insight increased the level of risk in its arbitrage betting from the no risk strategy agreed with its investors. This was not communicated to its new and existing investors.
- From July to October 2014, Mr Hosie sent figures and screen-shots, showing material balances for particular betting accounts, to investors as assurance that their investments were safe. However, he had previously tried to withdraw monies from the betting accounts concerned and discovered that the screenshots were inaccurate and there were no funds in them.
- From July 2014, he informed investors that £1.05M was held in a new bank account and delays in payments to them were due to the account being temporarily frozen. This statement was untrue.
A disqualification order has the effect that without specific permission of a court, a person with a disqualification cannot:
- act as a director of a company
- take part, directly or indirectly, in the promotion, formation or management of a company or limited liability partnership
- be a receiver of a company’s property
Disqualification undertakings are the administrative equivalent of a disqualification order but do not involve court proceedings.
Persons subject to a disqualification order are bound by a range of other restrictions.
The Insolvency Service, an executive agency sponsored by the Department for Business, Energy and Industrial Strategy (BEIS), administers the insolvency regime, and aims to deliver and promote a range of investigation and enforcement activities both civil and criminal in nature, to support fair and open markets. We do this by effectively enforcing the statutory company and insolvency regimes, maintaining public confidence in those regimes and reducing the harm caused to victims of fraudulent activity and to the business community, including dealing with the disqualification of directors in corporate failures.
BEIS’ mission is to build a dynamic and competitive UK economy that works for all, in particular by creating the conditions for business success and promoting an open global economy. The Criminal Investigations and Prosecutions team contributes to this aim by taking action to deter fraud and to regulate the market. They investigate and prosecute a range of offences, primarily relating to personal or company insolvencies.
The agency also authorises and regulates the insolvency profession, assesses and pays statutory entitlement to redundancy payments when an employer cannot or will not pay employees, provides banking and investment services for bankruptcy and liquidation estate funds and advises ministers and other government departments on insolvency law and practice.
Further information about the work of the Insolvency Service, and how to complain about financial misconduct, is available.
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