CBD Executive Jailed for Fraud and Money Laundering After Purchasing Lanzarote Property with Illicit Funds

A director of a management consultancy has been sentenced for fraud and money laundering after illicitly securing a Bounce Back Loan and using the funds to purchase a property overseas. Alex Hope, aged 41, fraudulently obtained a £25,000 loan in 2020 by falsely inflating his company’s turnover. He was also a director of Virtutum Limited, trading as CBD Asylum in Hull, which secured an additional £56,000 loan from a private lender in 2021.

The funds from both loans were laundered through various bank accounts before being directed towards the acquisition of a property in Lanzarote intended for Hope and his wife. His business partner and co-director at Virtutum Limited, Liam Jones, aged 42, was also found guilty of fraud concerning the £56,000 loan.

Fraudulent Activities Uncovered

Both Hope and Jones had signed the loan agreements, falsely assuring lenders that no legal actions were pending against them. In reality, they had been pursued by a specialist litigation firm for approximately £800,000 since 2019. The two defendants pleaded guilty on the first day of their trial at Hull Crown Court in June and were sentenced on 27 July.

Hope, residing in Elm Tree, Halsham, East Yorkshire, was convicted on two counts of fraud, one count of money laundering, and for failing to disclose the value of his company shares while bankrupt. His sentence included three years in prison, suspended for three years, an eight-year disqualification from being a company director, and a requirement to complete 250 hours of unpaid work.

Jones, who lives on Edinburgh Drive, Holton-le-Clay, Lincolnshire, received a ten-month prison sentence, suspended for 18 months, along with a two-year disqualification as a company director and a mandate to complete 100 hours of unpaid work.

Commitment to Combatting Financial Crimes

Mark Stephens, Chief Investigator at the Insolvency Service, stated that Hope’s deliberate misrepresentation of his company’s turnover to secure a COVID-19 loan intended to support businesses during the pandemic was a serious offence. He further highlighted that the funds from both fraudulent loans were laundered through a series of bank accounts and ultimately used for a property purchase abroad.

Hope was the sole director of A Hope Ltd, incorporated in August 2012. In August 2020, he fraudulently applied for the Bounce Back Loan by claiming a turnover of £100,000, despite company accounts indicating less than £13,000. Virtutum Limited, established in September 2017, initially had Hope as its sole director, with Jones joining as a second director in October 2019. The duo claimed their products aimed to provide the benefits of CBD to a broad audience.

Legal Consequences and Recovery Efforts

Funds from both loans were transferred through multiple accounts before being used in a payment of €245,825 for a two-storey, semi-detached house in Puerto Calero, registered in the names of Hope and his wife. Both defendants were declared bankrupt in March 2022, with Hope later committing another offence by failing to disclose the actual value of his shares in Aspen Homes Hull Limited to the bankruptcy trustee.

The Insolvency Service is now pursuing the recovery of the fraudulently obtained funds under the Proceeds of Crime Act 2002, underscoring its commitment to holding individuals accountable who exploit loan schemes for personal gain.

For further information, it is worth noting that Alex Hope resides in Elm Tree, Halsham, East Yorkshire, with a date of birth of 2 March 1985, while Liam Jones is from Edinburgh Drive, Holton-le-Clay, Lincolnshire, born on 13 July 1984. Both companies involved, Virtutum Limited and A Hope Ltd, hold the registration numbers 10982123 and 08193238, respectively.

Individuals subject to a disqualification order or undertaking are required to adhere to a range of restrictions. Directors can access detailed information regarding their obligations and responsibilities through the Insolvency Service’s Director Information Hub, which also provides guidance on how to report financial misconduct.