Fraudster Daniel Pugh, 35, has been jailed for 7 years and 6 months for running a £1.3m Ponzi investment scheme.

Mr Pugh, of Devon, set up and ran the Ponzi scheme with another individual, netting more than £1m.

He lured investors to the bogus scheme via Facebook ads that promised huge returns.

Mr Pugh ran the unauthorised investment scheme from his bedroom in Devon and conned 234 people, according to the FCA which brought the prosecution.

The fraudulent Imperial Investment Fund (IIF) took money from investors Mr Pugh targeted largely through Facebook adverts.

Investors were offered “impossibly high” returns of 1.4% a day, 7% a week or 350% a year.

Mr Pugh received £96,000 from the scheme and used the money to support his lifestyle, including designer clothes, restaurants and withdrawing £18,000 in cash.

The returns Mr Pugh promised to investors did not materialise. He fooled investors into believing he was successful at trading and their money was safe.

The FCA said that even at the point he knew the scheme was collapsing, he continued to try to attract more investors into the scheme.

The sentencing was as follows:

• 7 years and 6 months of imprisonment for conspiracy to defraud.

• 24 months of imprisonment for two offences of carrying on a regulated activity in the UK without FCA authorisation or an exemption, to be served concurrently.

• 12 months of imprisonment for communicating an invitation or inducement to invest without FCA authorisation or the content of the communication being approved by an authorised person, to be served concurrently.

Steve Smart, executive director of enforcement and market oversight at the FCA, said: “Pugh made outlandish claims to hook in victims but in reality this was nothing more than a massive fraud.

“Fighting financial crime is a priority for the FCA. We will take action to ensure criminals face repercussions for their actions, including being denied access to any ill-gotten gains.

“People’s online personas are often at odds with reality, as was the case with Pugh. Claims that sound too good to be true, are usually just that. Check the FCA Firm Checker before you invest.”

In sentencing, His Honour Judge Weekes said there were, “persistent and knowing breaches of the regulatory framework” by Mr Pugh and that any remorse for his actions came “woefully late.”

He added: “The consequences for them [the victims] are marked and apart from financial loss they feel embarrassment.”

The FCA is pursuing confiscation proceedings against Mr Pugh to try to compensate the victims.

Mr Pugh was also disqualified from being a director of a company for eight years, effective on release from custody.

A further individual is wanted in relation to the same offences.

The regulator said that in the last 6 months, the FCA has secured criminal convictions in relation to 6 individuals for a range of financial crime offences including money laundering, insider dealing and fraud.

• The FCA says it has attempted to contact investors who lost out. Anyone who was scammed by IIF and has not heard from the FCA should email This email address is being protected from spambots. You need JavaScript enabled to view it.