Tony Hetherington reports on a real estate venture headed by an expat with a history of working with less than scrupulous partners.

They say you can tell a lot about a man by the company he keeps. I wonder, then, where this leaves Vincent Bithell, a 41-year-old British expat living in upmarket Esplugues de Llobregat on the outskirts of Barcelona.

Bithell moved to Spain in the 1990s, after a spell at the less reputable end of the financial services industry in Britain, and he soon popped up at two Spanish stockbroking firms, Mercantile Securities Consultants and Novak & Goode. There was just one slight problem: neither firm was licensed by Spain’s financial regulator.

In these firms, Bithell had two close associates, Michael Ivor Braff and Steven Derek Crump. Braff had been a salesman at London futures dealer David Coakley Limited, which had the reputation, and the appearance, of a betting shop rather than an investment business.

In 1994, the watchdog Securities & Futures Authority closed it down for numerous offences against investors. Braff was personally fined £10,000. Despite being unlicensed, Braff set up Global Currency Limited, and this cost him two months in jail. On his release, he went straight back to work, opening Porchester Securities, which promised investors yields of 7% a month. This time he was jailed for nine months, after which he decided his future lay in Spain.

Vincent Bithell’s other partner in Spain was Steven Derek Crump. A one-time barman from Essex, Crump was ambitious. In 2003 he set up his own fake broking firm, called Gilberts, and ran it from his father-in-law’s home in Basildon, selling shares in Virtual Vineyards, a wine business, before it even existed as a company.

Last year, justice caught up with Crump. Having warned against Gilberts while it was still raking in cash from unsuspecting investors, I was called as a prosecution witness at his trial at Southend Crown Court. Convicted of fraud, Crump was sentenced to 21 months in jail.

Of course, working with investment cheats does not make Bithell one. But it does mean that any new venture he gets involved in is worth a closer look.

Right now, Vincent Bithell is owner and director of Graystone UK Limited, a company with an address in Broad Street in the heart of the City of London. Less impressively, however, the address turns out to belong to a firm that takes in letters for anyone who pays, and redirects their post and calls to wherever they want in the world.

Bithell says his business is "dedicated to offering the private client opportunities in real estate". What this means is that he sells land with the tale that its value will rocket when the local council grants permission for housing.

And here Bithell runs into a dilemma. If investors are forced to apply together for planning consent, or to sell their plots to one developer, then the whole business has the same legal status as a unit trust and needs a licence from the Financial Services Authority. Bithell has no licence and could be jailed for up to two years if he operates a collective investment scheme without one.

On the other hand, if plot owners are not obliged to act together, developers will go elsewhere because they could be held to ransom by just one or two owners who refuse to sell.

Bithell insists that Graystone is not operating an illegal scheme, so it looks as though anyone who has bought land will be stuck with it. One local council in whose area Bithell is offering land has announced that it will not consider any planning applications before 2024. By then, my guess is that Vincent Bithell will have moved on to pastures new.

• Tony Hetherington
• caveat emptor