City stockbroker Nicholas Levene faces a “substantial” jail term after he pleaded guilty, at Southwark Crown Court on Monday, to cheating investors out of £32m.

The financier’s clients, who believed they were investing in shares in major multinational companies, were in fact were victims of a Ponzi scheme. This fraudulent mechanism is the same type as operated by Bernard Madoff, who is currently serving a 150-year jail sentence in the US. It operates by new investors’ money going to pay off debts to previous investors.

Mr Levene, who previously said that he gave money to Lubavitch and Jewish Care, is said to have many Jewish and Israeli victims. He admitted to defrauding Israeli investor Yigal Ahouvi of £14.9m in April 2007.

Mr Levene was awarded conditional bail until he is sentenced on October 22.