Biggest fraud on the LSE

Had trouble sleeping last night and was awake for hours with an overactive mind.

For some reason Langbar came into my head, Langbar was the biggest fraud on the London Stock Exchange, and a younger me was caught up in the middle of it.

“Langbar International: the greatest stock market heist of all?

No gun was ever pulled, no cashier terrorised, no bank vault cracked. But the rapid rise and fall of Langbar International was one of the most audacious, meticulously planned heists ever to take place in Britain.

And, investigators believe, it was executed by a small band of mild-mannered, middle-aged businessmen from across continental Europe who it is now certain will not face justice. How much they took will never be known, but victims’ losses are estimated at up to £100m.”

Langbar (formerly Crown Corporation) bought under performing companies and their assets where they saw they were undervalued.

I dont remember the actual numbers, but say the shareprice was 50p, they had they’re assets auditted by a large, well known international auditor & they verified if they sold all their assets the share price is worth say £1.20, this was confirmed by an RNS release at the time.

I was already a small holder but as soon as the RNS came out confirming this I got all the money I could get together & bought all the shares I could sub 75p.

Turns out the bank, the bank staff, the assets & everything was all setup & staged, fooled the auditors, the markets & everyone else.

“In truth, the trip to Brazil had been the most elaborate deception of all. On arrival Pearson was told a bomb scare at Banco do Brasil’s main office meant his meeting with one of the bank’s lawyers would have to take place elsewhere. São Paulo police would later tell SFO investigators the serviced office block to which Pearson had been diverted was a notorious fraud hotspot. The supposed lawyer’s signature was an unidentifiable squiggle. The supposed lawyer was never traced.”

Typically us the shareholders had our lives & families ruined (some are reported to have committed suicide) & the perpetrators dissappeared into the sunset, with all the cash.

“Events might have been different. Just as the net appeared to be closing three years ago, the SFO was stopped in its tracks by the sudden death from a heart attack of central conspirator Arad. A further seven arrests in Spain and Switzerland had also been made but the prospect of other potential defendants blaming Arad for the fraud was now glaring.

Having learned this week that the SFO has formally closed its Langbar file, there will be champagne corks popping in one or two comfortable homes across Europe this weekend.”

The above excerpts are from an article in the Guardian in 2011

It was personally a very expensive lesson which took many years to recover from, learn’t a lot of lessons along the way & I hope the stories from the forums at the time about investors taking their own lives are not true, saddly though, I feel they probably are.


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