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The Living Force
Luc Jean Chaudhary
As quoted in the Hallbrook Partners website in this post here , Luc Jean Chaudhary was involved in the 3 companies caught and held in default by FSA - Pacific Continental, Mansion House Securities and Ascension.
http://www.hallbrookpartners.co.uk/firmsInDefault.aspx#
This character has been caught on tape selling junk shares.
http://www.thisismoney.co.uk/money/news/article-1602904/Junk-shares-sales-pitch-caught-on-tape.html
As quoted in the Hallbrook Partners website in this post here , Luc Jean Chaudhary was involved in the 3 companies caught and held in default by FSA - Pacific Continental, Mansion House Securities and Ascension.
http://www.hallbrookpartners.co.uk/firmsInDefault.aspx#
Another notable member of staff was Luc Jean Chaudhary. After over five years as a salesman at Pacific Continental, he joined Mansion House in 2006 and became a director. In March 2008, Mansion House was fined by the Financial Services Authority (FSA) £122,500 for breaches of the FSA Principles for Business and Conduct of Business Rules. Chaudhary left Mansion House in May 2008 and joined Ascension Securities Ltd.
This character has been caught on tape selling junk shares.
http://www.thisismoney.co.uk/money/news/article-1602904/Junk-shares-sales-pitch-caught-on-tape.html
Junk shares sales pitch caught on tape
By Tony Hetherington and Tony Hetherington
UPDATED: 08:06 EST, 1 October 2006
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EVERY week, Tony Hetherington replies to readers' letters, adding comments, advice and the results of his enquiries.
If you think you are a victim of financial mismanagement, or want advice before investing, write to Tony Hetherington, Financial Mail, 2 Derry Street, London W8 5TS. Sorry, but he cannot give personal replies. Please send only copies of documents - if these are relevant to your enquiry. We regret that they cannot be returned.
M.B. writes: It is amazing how many horror stories there have been regarding American Regulation S shares marketed by London broker Pacific Continental Securities.
The firm first approached me in 2003 to invest £2,000 in Accupoll. To my amazement, the price climbed. I later put £2,000 each into Roaming Messenger and Angelciti Entertainment. Wow, was I on a winner.
The last con, in 2004, was West Africa Gold. Adviser Luc Chaudhary offered shares at a third of the market price. This was unreal. If I invested £4,000, they would already be worth £12,000. So I agreed. Later that day I decided this did not sound right. I refused to pay for the shares or sign Pacific Continental's risk acceptance form. Then came messages about how they wanted paying. Matters would soon be beyond my control.
I handed over £4,000. Two weeks later, everything started to crash. Eventually, I found the West Africa Gold shares, said to be worth £12,000, worked out at £50. I feel gutted that I was duped by a legally authorised investment firm.
IS Pacific Continental the riskiest broking firm in Britain? Or just the unluckiest? Financial Mail has received more than 60 complaints from customers who bought shares in tinpot American companies with predictions of huge profits.
Most admit that they knew the American Regulation S rule meant investors could not sell their shares for one year. Less clear was that this regulation covers shares that fail to comply with US investor protection laws, so can only be sold to non-Americans.
Time after time, prices crashed before investors could get out. Financial Mail knows of 40 American companies tipped by Pacific Continental. Every share collapsed, some by 100 per cent.
Roaming Messenger is a good example. You paid £2,000 for shares in this loss-making California technology business. Those shares are now worth about £70. The company says there is 'substantial doubt' about its survival. And its two bosses are facing charges of securities fraud.
In response to complaints, Pacific Continental's managing director Steven Griggs consistently makes two points - that investors confirm they accept the risks and that sales calls are recorded. This time, both arguments have come unstuck. You refused to sign the risk acceptance form, but were still harassed to hand over £4,000.
As for the taped sales calls, these have always been Pacific Continental's ace in the hole. Anything not covered in writing must have been dealt with by phone. But when its own customers gave written authority for the disclosure of those tapes, Griggs refused.
What he did not know until recently was that his salesman Luc Chaudhary called you on your carphone, which has a recorder. Small wonder that Griggs and Chaudhary now blame each other.
On the right is an edited version of what Pacific Continental salesman Luc Chaudhary said about West Africa Gold.
Chaudhary's sales pitch for West Africa Gold is riddled with misleading claims. Mark Axtell did work for instant office company Regus, but was not a director, let alone the chairman.
And the immediate profit of $38,000 was an illusion. Investors were banned from selling. If they had been allowed to sell, the price would have collapsed.
The target share price of $8 to $10 was straight from Alice In Wonderland. West Africa Gold is now called Great West Gold and has changed its share structure, but a few days ago the company said: 'The stock could hardly be trading at a lower price.' It is well below one American cent.
The 50,000 'proven' ounces of gold were also hard to pin down. Great West Gold says simply that it 'withdrew' from Africa.
Neither Chaudhary nor Griggs has explained the supposed approaches from people queuing to buy up Accupoll.
Chaudhary has left Pacific Continental and is now a director of Mansion House Securities, a fully authorised broking firm in the City.
Threatening to sue if Chaudhary was named, his lawyers told Financial Mail: 'Mr Chaudhary denies that he misled or misrepresented Mr B as you appear to be alleging.
'He was at all times working as an employee of Pacific under that company's management's strict control and guidance.'
Anything Chaudhary claimed was based on Pacific Continental's sales notes, say his lawyers. However, Griggs suggests that Chaudhary overstepped permitted boundaries.
He says: 'We are extremely concerned to ensure that our brokers adhere to telephone scripts, which are approved by our compliance department, and our brokers are under strict instructions to follow approved scripts and procedures.'
Adding that 'it would appear the broker in question ignored the approved procedures', he indicated that had Chaudhary still been employed by Pacific Continental, his conduct 'would have resulted in disciplinary action'.
Griggs did not identify the claims made by Chaudhary that went beyond his sales script.
Caught on tape
Chaudhary: The price is three dollars a share, OK? MB: OK.
Chaudhary: That's the bid, the buying price is $4. MB: Blimey.
Chaudhary: We've got a two-year restriction and because of this we've secured a deal at $1 a share. MB: A dollar a share? Chaudhary: Have you ever gone ten grand in a stock?
MB: I don't know if I could afford ten grand!
Chaudhary: ... I feel this stock is going to be the key to our
partnership. To let you understand, Mark, you know that ten grand, yeah? MB: Yeah.
Chaudhary: Times 1.87, which is a dollar, yeah?
MB: Yeah. Chaudhary: That'll be 18,700 shares? MB: Yeah.
Chaudhary: If we pick it up at a dollar, that's 18,700 shares, yeah? MB: Yeah.
Chaudhary: Now, the price, the sell price, is three dollars, yeah?
MB: Yeah, yeah. Chaudhary: What this means is... your $18,000, already we will be up in profit $38,000. This company, the CEO was the ex-chairman for Regus, Mark Axtell...50,000 ounces of proven gold in one project, they've got five in West Africa . . . With gold, the next two years, we're looking at a target of $8 to $10. It already shot from $2.50 to $3 yesterday but we've secured all our clients in at a dollar a share, Mark. MB: Er, I don't think I could get ten grand.
Chaudhary: If only we'd gone ten on
Accupoll, Roaming, Angelciti, this stock, at a dollar a share mate, is too good to miss.
MB: Yes, but I don't think I've got ten grand.
Chaudhary: Four dollars on the market, to sell three dollars. We've got a two-year restriction. If the company get bought up earlier - we get a lot of offers on Accupoll, you know that don't you?
MB: Yeah. Chaudhary: Everyone wants a piece of it now, OK? But the stock's obviously gone, OK?
MB: Yeah. Chaudhary: With this stock, if we pick it up at a dollar, I think we're going to be in a very strong position. MB: It is, but there is no way I can get ten grand.
Chaudhary: Stick with me mate. If I make you money, you stick with me. MB: OK, I'll do four grand. I'm stretching, I can't do any more. Chaudhary: Hold the line one second... Mark...
MB: Hi, yes? Chaudhary: It looks like we can pull this off.
MB: OK. Chaudhary: Shall we go for that? MB: OK.
Chaudhary: You know it's a twoyear restriction, OK?
MB: Yes. Chaudhary: And we're getting you at the point of 4K at a dollar a share? MB: OK.
Chaudhary:...obviously it's a small capital company, very early stages of formation, by definition these companies are high-risk investments. You know that, don't you?