A financier who believed that animated peas would

A financier who believed that animated peas would be the
next rage following the Teenage Hero Mutant Turtles was today
Monday jailed for two years for a City shares fraud.

Leonard Lee, 29, of Holly Mews, Chelsea, exploited his spotless
reputation in the City to illegally prop up the shares of the
company starring Grum-pea, Hap-pea and Pea-C Pod.

‘Cynical’ Lee secretly bought millions of shares himself to fool
the market that legitimate investors were lapping up spare shares.

But he was caught out when he could not pay for the shares he
bought, landing two elderly women, stockbrokers, institutional
investors and Lee’s own company with a pnds stlng 3,000,000 loss.

At the Old Bailey Lee pleaded guilty to creating a false market.

Judge Bruce Laughland QC told him he had brought ‘dishonour on the
City’ at a time when it was trying to maintain its international
standing as a financial centre.

‘You exploited your high reputation and damaged the firms which had
trusted you.

‘
The court was told Lee and his company Cleves Investments Ltd (CIL)
were specialists in floating small companies.

‘By 1989-90 he had acquired a good reputation in the City as an
expert in the field and as someone who could be trusted,’ said Mr
David Cocks, QC, prosecuting.

Despite the recession, Lee successfully floated Poddington Peas in
January, 1989, bringing in pnds stlng 1.

2 million to finance a series
of promotional videos.

Despite having little more in assets than an idea of humanised
peas, shares boomed from the initial price of 20p each to 100p before
settling at a price between 70p to 80p.

The company seemed promising with a BBC contract and burgeoning
distribution and merchandising rights, the court was told.

Within a few months, Lee’s company began boosting the 600,000
shares it had received as part of its fee by secretly buying shares
through an off-the-shelf Panamanian company.

Lee’s market manipulation maintained Poddington Peas shares at an
artificially high rate.

Matters became desperate when Chancellor Nigel Lawson resigned in
October that year, causing a mini-crash in the market.

Lee’s fraud was exposed when he failed to meet the rolled-over
payments for his holdings, which by now included over two million
Poddington Peas shares.

Shares crashed to the nominal value of 5p but the company, based in
Boscombe Road, Southend-on-Sea, Essex, is still trading, the court
heard.

Among the losers were two elderly women who had separately invested
a large share of their life savings in Poddington Peas shares.

Mrs Carol Evans, of Mortlake, invested pnds stlng 89,000 but has
been paid back all but pnds stlng 12,000 of that by Lee.

Mrs Phyllis Morford, also of Mortlake, invested over pnds stlng
14,000 and has been fully reimbursed.

Two brokerage companies also went into liquidation when the fraud
was uncovered.

After he was arrested on July 17, 1990, he maintained that real
investors had bought shares through the Panamanian company.

But in court, he pleaded guilty to creating a false market.

Charges of theft and false accounting were not proceeded with.

Mr Richard DuCann QC said in 12 years with CIL, Lee had built a
‘reputation for respectability, responsibility and reliability’.

Propping up the shares artificially was part of a misplaced sense
of support for an idea Lee believed had the potential to become a
runaway financial success, he said.

When the market failed to improve, he lost everything.

CIS is now
in liquidation and he will never again be able to work in the City.

Judge Laughland told Lee he had acted ‘cynically and recklessly’ in
the months before true value of Poddington Peas shares was revealed.

‘The main losers were banks, stockbrokers and market makers.

‘Two firms of stockbrokers were forced into liquidation with all
the personal human misery that such a result involves.

‘Others had earlier exposed themselves to the possibility of losses
but passed the dangerous parcel on before it came to the end of the
line.

‘I think you were quite cynical and it was carried out
repetitively.

‘You exploited your high reputation and damaged firms which trusted
you.

‘You were discreet but that was a cunning part of the deception.

‘There was wider damage to the reputation of the City of London
which just now happens to remain a centre of the international
financial world with a jealously guarded reputation.

‘
He took into account Lee’s plea of guilty and the fact that he now
has nothing to show for his years of ‘honest and honourable’ work
before turning to crime.

‘This crime cannot be passed over without a sentence of
immediate imprisonment,’ said the judge.

Lee did not react as he was jailed for two years.

ENDS
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