Financial adviser’s wife found he stole nearly £15million for gambling as armed police arrive

Financial adviser’s ex-wife calls on banks and betting companies to do more to detect fraud and protect victims after discovering her ex-husband stole nearly £15million to feed his addiction at the game when the armed police arrived at their front door.

Hannah David, 51, who worked as the national director of the Conservative political forum, said armed officers came to the house with a warrant in November 2017.

Freddy David, 53, from Borehamwood, Hertfordshire, who was managing director of HBFS Wealth Management, had used his reputation in the Jewish community to sell fictitious opportunities to his clients. This has left some of its elderly investors contemplating suicide.

He had become a gambling addict who robbed 55 customers through a Ponzi scheme and set it up alongside his business to feed his habit. He used part of an £80,000 investment from a victim to feed his gambling addiction and pay his children’s private school fees, while setting up a restaurant called Let’s Meat and taking trips to Greece and in Israel.

A Ponzi scheme is an investment fraud that pays existing investors with funds raised from new investors. At Southwark Crown Court, it was revealed that David had bet around £15million in 10,000 online transactions.

Over £13million of the money was stolen from investors and the addiction was so bad that David gambled more money than he took. The total loss to victims was £6,998,942.17, but the sum David was ordered to repay had to be ‘realistic’ and he was ordered to repay £1,340,111.

His family never saw the money and at one point he lost £250,000 in one day. David was imprisoned for six years for theft and fraud. Ms David has since filed for divorce and sold the family home along with other joint property.

Freddy David, 53 (pictured), from Borehamwood, Hertfordshire, had used his reputation in the Jewish community to sell his clients fictitious opportunities

David was released in June 2021, having served half his sentence. He had lived in a £1million detached house in Elstree, Hertfordshire.

Victim Leon Winsky said after the hearing that he lost £300,000 in savings to David and considered suicide. Mr. Winsky worked from age 14 until retirement at age 66.

“Freddy David destroyed my family,” he said. “I worked long hours for fifty years, I thought I would go to an honest Jewish financial adviser.”

He explained that when he found out about the fraud, he was so distraught that he contemplated suicide.

“My first thought was suicide, but just when I was about to jump in front of a train I decided to face it in court instead.

“The money invested in Freddy David was eventually going to be used for an apartment for my son Jonathan with special needs.

“We only have two meals a day instead of three. For now, we manage to survive on my small pension.

After his arrest, David told police, “I’m public enemy number one in the Jewish community and understandably, I have very, very few friends left and I understand why.”

Hannah David (pictured) calls on the government to introduce legislation to reduce the harms of gambling

Hannah David (pictured) calls on the government to introduce legislation to reduce the harms of gambling

The Ponzi scheme had helped fund an online gambling habit that blew him £15.6m from betting sites between January 2005 and November 2017, including £240,000 in a single day.

Speaking to The Times, Ms David said: “At that time [in 2017], my husband and I had been married for 24 years, and although our relationship was far from perfect, I had no reason to believe that he was involved in any criminal activity.

She said it became clear in the weeks that followed that her husband was orchestrating a massive fraud, targeting vulnerable members of the community.

Now Ms David is calling on the government to put in place legislation to reduce the harms of gambling.

The 51-year-old, who met her husband on a student trip in 1989, was a Conservative Party councilor and stood as a parliamentary candidate in Harrow West in 2015 and 2017.

When she met her husband, he was studying industrial economics at the London School of Economics and she was at the University of Leeds doing law.

Four years later they were married and David worked at Barclays Bank while Ms David trained as a lawyer.

David took over a wealth management company in 2003, after leaving Barclays.

Ms David was a practicing lawyer with three children at the time and said: ‘I felt financially secure and we had a privileged life.

What is a Ponzi scheme?

The term Ponzi scheme was coined in 1920 by a con man called Charles Ponzi.

However, the first recorded cases of this type of investment scam date back to the mid-1800s and were orchestrated by Adele Spitzeder in Germany and Sarah Howe in the United States.

A Ponzi scheme is an investment fraud that pays existing investors with funds raised from new investors.

The organizers of the program promise to invest your money and generate high returns with little or no risk.

But in many, if not most, schemes, the scammers don’t invest your money and instead use it to pay off those who invested earlier.

They can also keep some for themselves. One of the most infamous Ponzi schemers was Bernie Madoff.

His scheme eradicated the fortunes of people – rich and poor – and destroyed charities and foundations around the world.

It destroyed the lives of its 37,000 victims and the scheme amounted to $20 billion – the biggest financial fraud in history.

Some of his properties have been auctioned off over the years to compensate victims of the scheme.

Source: Investopedia

Fourteen years later, it became clear that the life the couple led was not as clear as it seemed to Ms David.

She realized her husband had been lying to her for over a decade.

Mrs David knew their marriage was over when her husband confessed to her about his gambling addiction.

She filed for divorce and sold the family home and another condominium.

The 51-year-old now lives in rented accommodation.

She said she felt lucky that her children were old enough to fend for themselves, but none of them fully accepted what had happened.

She said she had always worked and was in a good position to rebuild her life so she didn’t feel victimized.

But although she said David had hurt others more than her, she admitted the incident had an emotional impact on her.

She is now working with Carolyn Harris, Labor MP and Chair of the All Party Parliamentary Gambling Harms Group.

Ms David said she realized gambling was a hidden addiction that had no physical symptoms and could go unnoticed by family and friends.

Eventually, the problems it causes can no longer be concealed.

She said learning about gambling addiction over the past four years made her discover that much could be done to help people with addictions and their families, friends and community.

The 51-year-old noted that David was able to gamble huge amounts of money for over a decade.

And his bank or the online gaming companies did not intervene.

The Gambling Act 2005 is being reviewed by the government as it has been criticized for liberalizing gambling laws and allowing advertising.

Ms David thinks banks should monitor large sums of money and transactions moving from accounts to gambling companies.

Ms Harris said Ms David’s story reveals how gambling addiction can affect people from all walks of life and have tragic consequences.

She said more needed to be done to identify high-risk behavior, but praised banks for the work they are doing to look at the harms of gambling and the responsibility they bear.

Ms David is now working with Carolyn Harris, Labor MP (pictured) and chair of the All-Party Parliamentary Gambling Harms Group, to campaign against the problem

Ms David is now working with Carolyn Harris, Labor MP (pictured) and chair of the All-Party Parliamentary Gambling Harms Group, to campaign against the problem

Geraldine L. Melton