Over 1,500 investors invested an estimated £150 million into the leasehold schemes on the back of these guaranteed returns, but they all stopped receiving payments in 2018
Dawn raids have taken place as part of an undercover fraud probe linked to a £150m students flats scheme.
The Serious Fraud Office (SFO) carried out a series of co-ordinated actions on Wednesday following a six-month covert investigation into suspected fraud and money laundering at the Alpha and Green Park groups of businesses.
The SFO is investigating whether the Alpha-branded companies fraudulently misled investors into purchasing leaseholds for student accommodation in Staffordshire, as well as Leicestershire, Lancashire and West Yorkshire.
These companies include Alpha Developments (Stoke1) Limited, Alpha Developments (Stoke) Limited, Alpha Developments (Stoke2) Limited – all based in Gateshead – although the identity of the accommodation has not been revealed by the SFO.
Green Park-branded companies, which sell leaseholds for holiday homes in Devon, are also a focus of the investigation.
Alpha and Green Park branded companies sold investments into leasehold units between 2014 and 2019, promising investors 8-10 per cent returns on their investment over the first 10 years.
More than 1,500 investors from nearly 50 different countries invested an estimated £150 million into the leasehold schemes on the back of these guaranteed returns, but they all stopped receiving payments in 2018.
But the SFO alleges the directors of the companies made around £20 million from their schemes.
Mick Gallagher, chief investigator at the SFO, said: Thousands of ordinary people lose their pensions or life savings on risky schemes, while those at the top line their own pockets and enjoy a lavish lifestyle. The Serious Fraud Office is committed to delivering justice for victims of fraud and corruption. We invite anyone who believes they have a connection with our investigation to come forward.
UK-based investors will now be contacted and asked to fill out questionnaires, which the SFO hopes will provide further information for the investigation.