‘Ponzi’ scandal claim hits Milton Keynes

Danny Hogan
Danny Hogan

A city property company is under investigation for allegedly committing a £40 million investment scam.

North Dakota Developments office in Witan Gate was this week closed as US federal authorities ordered the company’s bank accounts be frozen.

Shocked office staff, made redundant a few weeks ago due to “cash flow problems”, say they had no idea of what was going on.

Meanwhile investors from all over the world are demanding their money back from company boss Danny Hogan, who lives on Heelands.

Mr Hogan , who is married with children, failed to appear this week at a court hearing in America instigated by the US Securities and Exchange Commission.

The 44-year-old businessman, who formerly ran the MK-based Property Horizons Group, spent more than £120,000 of alleged investors’ cash on meals, expenses and entertainment, the hearing heard.

SEC claim his business partner Robert Gavin raised the £40 million from around 1,000 different investors and then operated a Ponzi scam.

The investors were told their money would pay for hundreds of workers’ homes to be built on four sites in oil-rich North Dakota, and were promised hefty yields.

In fact, claim SEC, the company “misappropriated” large amounts of capital to pay their sale agents’ commission – and three of the four sites are still undeveloped.

A former North Dakota Developments worker said: “The investors are furious.

“Some of them were people who mortgaged their homes to put money into this amazing sounding scheme.

“Now they are worried they’ve lost it all.

“Everybody is chasing Danny Hogan, but nobody knows where he is.”

One victim, Valerie Cuan, told how she invested £48,000 into an NDD scheme because such high returns were promised.

“This has turned into a nightmare,” she said.