Dazzled by the promise of plum winnings on the racetrack because of a secret mathematical formula, the investors that Bill Vlahos swindled named their syndicates accordingly — Richy Rich, Winners Circle, Oceans 18.
And they opened their bank accounts to him, too, pouring hard-earned savings into a club that he named “The Edge” because it would give participants a secret advantage on other punters.
The lure was strong.
One man transferred $1.2 million directly into the racing identity’s personal bank account, convinced that his investment would generate life-changing cash and on paper, that’s how things appeared.
But in reality, Vlahos was actually the principal of a preposterous Ponzi scheme that hustled investors out of $17,520,224.
Vlahos’s spending ‘dazzling’, judge says
The racing identity splashed the cash on first-class flights, two luxury cars, home renovations and a whip belonging to the champion racehorse Black Caviar, worth $47,000.
County Court Judge Douglas Trapnell today jailed the racing identity for nine years.
With time served, he will be eligible for parole in just over four years.
He described Vlahos’s spending as “dazzling” and said his crimes were “egregious”.
“Through your pernicious greed and insatiable desire for personal affirmation, you destroyed the lives and financial security of your family, friends and associates,” Judge Trapnell said.
“It is clear you must have known the impact you’ve had … yet you continued your deceptive scheme, unrelenting and unrepentant.
The court heard that Vlahos’s own defence lawyer accepted that his client’s conduct was “heinous”.
Between 2007 and 2013, Vlahos secured 1,800 investors across up to 61 syndicates, with most of his victims lured into the sham by word-of-mouth.
On Friday nights or Saturday mornings, Vlahos would send out betting sheets, which supposedly had the details of horses that would be backed that day at races in Sydney and Melbourne.
The following day, he would send out bogus result sheets.
His members were only allowed to withdraw or add to their position at the end of each quarter, and Vlahos would purportedly take a cut of about 10 per cent.
But in reality, Vlahos was paying out members from the pool of funds and using the rest of the cash to fund his lifestyle or other business interests.
Among his vices were a $149,500 Lexus, a $71,000 Audi, $103,213 first-class tickets to Dubai for himself and friends, and a jacuzzi worth more than $30,000.
Months before his scheme crumbled, Vlahos also made a record-breaking $5 million bid for a yearling called Jimmy, a relative of the famous Black Caviar.
As part of the grift, Vlahos claimed that bookmakers refused to take bets from him because he was winning too much.
He also claimed that his system was based on his knowledge of statistics when in reality, he was pinching betting sheet information from another form guide.
Judge Trapnell today told the court that the betting sheets Vlahos distributed were “meaningless”.
“You abused the trust of many, including family members and friends,” the judge said.
“You were the sole architect and controller of the fraudulent scheme.
Scheme causes trail of destruction
Police eventually caught up to Vlahos and arrested him in August 2015
The court heard that Vlahos’s conduct had left a trail of destruction in his victims’ lives, many of whom had lost family relationships because they had convinced their loved ones to invest.
Two victims lost house deposits, another had to sell his home to clear debts, and others spoke about losing friends who had fallen victim to Vlahos’s crimes.
“Your offending has had a profoundly traumatic effect and a devastating financial and personal impact upon them all,” the judge said.
Vlahos, who has a narcissistic personality disorder, initially faced 347 charges but ultimately pleaded to two counts of obtaining financial advantage by deception.
The court heard that there was no evidence his wife was aware of his crimes.