Three individuals charged in Axiom Fund investigation

Posted by Expat Investment Fraud on

21 August 2020 | Case Updates

The Serious Fraud Office has charged three men with multiple offences in connection with its investigation into the collapse of the Axiom Legal Financing Fund. Timothy Schools, David Kennedy, and Richard Emmett are charged with carrying out a fraudulent scheme to divert money from the Axiom Legal Financing Fund for their own benefit.

The case will be listed at Westminster Magistrates’ Court on Wednesday, 30 September 2020.

Notes to editors:

  1. Timothy Schools  (DOB 19.03.1961), a former solicitor, has been charged with three counts of fraudulent trading, contrary to Section 993(1) of the Companies Act 2006, one count of fraud, contrary to Section 1 of the Fraud Act 2006, and one count of transferring criminal property, contrary to Section 327(1)(d) of the Proceeds of Crime Act 2002.
  2. David Kennedy (DOB 07.01.1953), a former independent financial adviser, has been charged with one count of fraudulent trading, contrary to Section 993(1) of the Companies Act 2006.
  3. Richard Emmett (DOB 02.07.1973), a former solicitor, has been charged with one count of fraudulent trading, contrary to Section 993(1) of the Companies Act 2006, and one count of being concerned in an arrangement which facilitates the acquisition, retention, use or control of criminal property by another, contrary to Section 328(1) of the Proceeds of Crime Act 2002.
  4. The SFO announced its investigation on 16 May 2017.
  5. As these are live criminal proceedings, the SFO cannot comment further. The strict liability rule of the Contempt of Court Act applies.

Related Cases

Clients raise concerns over Quilter International still taking fees from a mis-sold fund

Posted by Expat Investment Fraud on

Quilter International, now owned by Utmost Group, has come under the spotlight for still taking client fees from a fund mis-sold by a subsequently jailed financial adviser, in a Sunday Times report on 12 December.

The Sunday Times said that Martin Rigney of Sheffield- based Topps Rogers Financial Management had not told clients that he was moving their money into high-risk unregulated investments, including Poland Geared Growth.

These investments have been frozen since 2008 and are now administered by JTC Fund Solutions (Guernsey) Ltd.

Quilter International has continued to take administration fees from investors to hold the mis-sold fund, it said, citing a number of clients affected by these ongoing costs.

While there was no suggestion of any wrongdoing by Quilter International, the adviser’s former clients “raised concerns about its failure to detect millions of pounds being transferred from ordinary regulated investments to high-risk unregulated ones over a short period by a single adviser”.

A spokesperson for Utmost Group confirmed to International Investment the following statement:

“Utmost Group completed the acquisition of Quilter International on 30 November 2021. Whilst we are not in a position to comment on individual cases, the provision of good customer outcomes is central to Utmost Group’s strategy and we take our obligations to clients seriously.

“The Group is continuously working to improve customer outcomes, providing value for money as well as full transparency around fees and charging structures. We apply the highest standards to the advisers we work with and work with advisers to ensure that customers outcomes are paramount.”

In a statement to the Sunday Times before it was taken over, Quilter International said: “Each case has been individually assessed and in some cases there was evidence of contributory negligence. We appreciate that these clients trusted Martin Rigby, but Quilter International cannot take responsibility for the adviser’s actions and is also not responsible for third-party fund selection. We would have conducted checks to ensure that Martin Rigby was a regulated adviser.”

In September 2017, Martin Rigney, formerly of Sheffield-based Topps Rogers Financial Management was sentenced to seven years in jail for forging client signatures.

He invested his clients, many elderly, into a high-risk unregulated collective investment scheme.

Rigney had forged documents by either writing clients’ signatures himself or photocopying real signatures.

He was found guilty of 16 counts of forgery back in July, following a 10-week trial, and sentenced on 1 September 2017.

At the time, according to the Derbyshire Times, detective constable Julie Wheeldon, who led the investigation, said: “Martin Rigney committed abhorrent abuses of trust against his clients, who were consequently caused financial difficulty and emotional distress.

“Our thorough and lengthy investigation demonstrates how seriously we take this kind of offence. Today’s passing of a seven-year sentence provides a significant deterrent to others that might think of defrauding trusting clients.”

Rigney had already been fined by the Financial Services Authority (now the Financial Conduct Authority) and banned from regulated activity for advising on unregulated collective investment schemes (UCIS).

Quilter International is still taking fees from the innocent savers who were scammed.

Posted by Expat Investment Fraud on

“You will have read the most recent expose’s on the criminal activities of a rogue Investment Advisor Martin Rigney who with the unwitting assistance of the recently sold Isle of Man Insurance Company Quilter International managed to steal hundreds of thousands of Pounds from innocent mainly retired Pensioners by advising them to transfer their Pension Funds in safe ordinary regulated Investments and in many instances their life savings into high-risk unregulated Investments  Funds held by Quilter International Insurance in the form of Redemption Bonds for which Quilter paid  Advisors varying rates of Commission of 5% or more and additionally charged management fees deducted from the funds in these Investment Bonds held on behalf of the Investors. Apart from the criminal activities of Martin Rigney involving forgeries for which he served imprisonment in 2017, there remain hundreds, perhaps thousands of Investors whose money remains trapped in these failed Funds and unable to redeem such of their failed Investments as may remain in these Bonds due to outstanding Management Fees and the demand by the Insurers that Investors sign documents absolving the Insurers from any liability arising from these failed Investments. You may also have lost your investments as a consequence of having been advised to invest in these Funds by an Investment Advisor typically following the Financial Crisis of 2009 but subsequently as these fraudulent Schemes went well into 2015and beyond..

You might have suffered financial loss as a result of a failed investment through a Pension Scheme of QROPS. What these Articles are yet to disclose is the fact that there are current Court Proceedings in the form of a huge Class action against Quilter International and Friends Provident Insurance also in the Isle of Man based on recommendations by Financial Advisors who recommended these Funds on behalf of their Clients on receipt of which the Insurers invested in extremely high risk and in many instances fraudulent Funds without having to undertake any or insufficient due diligence which they were legally obliged to do which would have disclosed the inordinately high risk or fraudulent nature of these Funds which inevitably failed. If you are an Investor in any of these failed or fraudulent Funds through the Agency of a Financial Advisor or Trustee of a Family Trust in conjunction with an Insurance Company in particular Quilter International or Friends Provident Insurance feel free to contact us with a view of possibly joining the Current Class Action the particulars of which are set out in this Web Site and in any event we will be happy to advise you.

LM Investment Management Limited

Posted by Expat Investment Fraud on

 

LM managed investment schemes

On 19 March 2013 the directors of LM Investment Management Limited (LM) appointed John Park and Ginette Muller of FTI Consulting as Voluntary Administrators. On 1 August 2013 creditors resolved that LM be wound up and John Park and Ginette Muller of FTI Consulting were appointed as liquidators. The role of the liquidators is to undertake the orderly wind up of LM.

ASIC has suspended the Australian financial services licence of LM: see 13-075MR.

On 7 April 2015 ASIC extended the initial 2-year suspension of LM’s AFS licence until 2 April 2017.

LM is the responsible entity of the following registered managed investment schemes:

  • LM Cash Performance Fund ARSN 087 304 032
  • LM First Mortgage Income Fund ARSN 089 343 288 (FMIF)
  • LM Currency Protected Australian Income Fund ARSN 110 247 875
  • LM Institutional Currency Protected Australian Income Fund ARSN 122 052 868
  • LM Australian Income Fund ARSN 133 497 917
  • LM Australian Structured Products Fund ARSN 149 875 669; and
  • The Australian Retirement Living Fund ARSN 162 406 162.

LM was also the trustee of the unregistered LM Managed Performance Fund (MPF).

LM First Mortgage Income Fund (FMIF)

On 8 August 2013 the Queensland Supreme Court appointed David Whyte of BDO as receiver of the FMIF.

Mr Whyte will effectively have control of the winding up of the FMIF.

Mr Whyte’s appointment followed ASIC’s intervention in court proceedings heard on 15-17 July 2013 in the Queensland Supreme Court (proceeding number 3383/2013).

These proceedings were initially commenced by two unit holders of the FMIF seeking orders for the appointment of Trilogy Funds Management Limited as the new responsible entity of the FMIF. The Court dismissed this application.

ASIC believes that the appointment of a receiver to the FMIF will allow the winding-up to proceed in the most efficient and cost effective way to provide the best chance of achieving the maximum return for investors.

Download the judgement from the Supreme Court of Queensland’s website

On 20 December 2013 the Queensland Supreme Court made orders in relation to the costs of these proceedings. It ordered that:

  1. Trilogy Funds Management Ltd pay 7% of LM’s costs of the proceeding; and
  2. LM is to be indemnified from the FMIF only to the extent of 20% of its costs of the proceeding.

LM also gave an undertaking that it would not seek from the FMIF any costs of or incidental to the investor meeting convened by notice dated 26 April 2013.

Pursuant to court orders, copies of the relevant court documents, can be found at the following website:
www.lminvestmentadministration.com

An appeal filed by LM Investment Management Limited against the decision of Justice Dalton was dismissed by the Court of Appeal (QLD) on 6 June 2014. The Court of Appeal upheld the orders appointing Mr Whyte as receiver of the FMIF.
Download the judgment from the Court of Appeal (QLD) website

LM Managed Performance Fund (MPF)

On 12 April 2013 the Queensland Supreme Court made orders appointing KordaMentha Pty Ltd and Calibre Capital Limited as joint trustees of the MPF.

On 10 February 2014, orders were made directing KordaMentha and Calibre Capital Limited to wind up the MPF.

For investors or creditors of the MPF, relevant court documents can be found on KordaMentha’s website.

Ongoing status of schemes and additional information

ASIC has been and will continue to liaise with the external administrators and monitor the current status of the managed investment schemes LM operated.

In September 2013 following an application by ASIC, the Supreme Court of Queensland ordered the surrender of the passport of LM’s founder Peter Drake, restrained his travel out of Australia without the prior consent of the Court, and froze his assets. William Fletcher and Tracey Knight of Bentleys were appointed as receivers of Mr Drake’s property: see 13-266MR.

In November 2014 ASIC started legal action against Peter Drake, and former directors, seeking financial penalties and banning orders.

ASIC’s civil penalty proceedings in the Federal Court of Australia are against Mr Drake, Francene Maree Mulder, Eghard van der Hoven, Simon Jeremy Tickner, and Lisa Maree Darcy.

ASIC alleges Mr Drake used his position to gain an advantage for himself and the former directors breached their director’s duties for failing to act with the proper degree of care and diligence regarding transactions involving the MPF: see 14-308MR.

The trial against the former directors commenced on 29 August 2016 in the Federal Court at Brisbane and is due to conclude on 23 September 2016.

On 12 September 2016, after the close of its case, ASIC’s proceedings against the fourth and fifth respondents was dismissed by consent. 

On 23 December 2016, the Court found that Peter Charles Drake, Francene Maree Mulder and Eghard van der Hoven did not breach their duties as directors of LM Investment Management Ltd (LMIM): see MR 16-461.

We will provide updates on our website on matters affecting investors as public information becomes available. Consistent with our policy in relation to investigations we are not at this stage in a position to comment further publicly.

Contact details

Investors seeking information about LM and its schemes should contact the appropriate external administrators directly:

FTI Consulting (LM and schemes other than FMIF and MPF

BDO (FMIF)

Investors seeking information about the LM Managed Performance Fund should contact the trustees directly:

KordaMentha (the Trustees)

Creditors seeking information about LM Administration Pty Ltd (In liquidation) (LMA) should contact the liquidators directly:

David Clout & Associates

Investors can also access additional information in relation to the process of winding up on www.asic.gov.au/insolvency-investors.

If you received advice from a financial adviser

If as an investor you have received advice from an Australian financial adviser in relation to your investment and have a complaint in relation to the advice provided you may wish to consider lodging a complaint with the relevant adviser’s External Dispute Resolution Scheme.

You can access additional information about how to complain on ASIC’s MoneySmart website.

If you as an investor received advice from an adviser in another jurisdiction and have a complaint in relation to the advice provided, you may wish contact the regulator in the relevant jurisdiction to discuss whether any further action can be taken.

Taxation inquiries

For any tax-related questions or concerns, please contact the Australian Taxation Office on 131 020.

Trouble with debt

If you are having debt and cash flow issues see trouble with debt on ASIC’s MoneySmart website.

Reporting information to ASIC

To report information to ASIC on LM, please contact ASIC on 1300 300 630 or go to www.asic.gov.au/complain

Kijani Commodity Fund

Posted by Expat Investment Fraud on

Kijani mean green in Swahili and was described as “the commodity equivalent of fair trade coffee” in 2011.[by whom?] The fund marketed to individual investors in Asia and the Middle East, investing in gold, oil and timber. Early on, it received $5 million in seed capital from billionaire Nadhmi Auchi, which was used for trading gold in Ghana.[3]

In 2014, it was re-domiciled to the Cayman Islands to attract UK investors.[4] The Cayman Islands Monetary Authority (CIMA) placed Brighton SPC in controllership following a forensic examination by PricewaterhouseCoopers.[5][6] The audit found that the fund’s only asset was a commercial loan to its primary company, Kijani Resources.[5][6] The Kijani Commodity Fund had voluntarily suspended its trading activities since March 2015.[5]

In June 2015, Kijani had more than $130 million in managed assets which were seized by Cayman authorities.[7] In October 2015, CIMA announced that Brighton SPC had been placed in liquidation by PricewaterhouseCoopers.[1]

References

  1. ^ Jump up to:a b Cairns, Patrick (6 May 2015). “Kijani assets scrutinised”. Moneyweb. The Citizen. Retrieved 4 July 2016.
  2. ^ Denham, Katherine (30 June 2015). “Belvedere-owned Kijani funds go into liquidation”. International Adviser. Retrieved 4 July 2016.
  3. ^ Patrick, Margot (3 August 2015). “Investigation of Seized Hedge Fund Highlights Risks”. The Wall Street Journal. Retrieved 4 July 2016.
  4. ^ Dew, Laura (28 January 2015). “Top-performing commodities fund moves domicile to target UK investors”. Investment Week. Retrieved 4 July 2016.
  5. ^ Jump up to:a b c Cairns, Patrick (2 June 2015). “Kijani update: Brighton SPC placed in controllership”. Moneyweb. Retrieved 4 July 2016.
  6. ^ Jump up to:a b Robertson, Benjamin (6 April 2015). “Funds marketed in Hong Kong linked to Belvedere fraud probe”. South China Morning Post. Retrieved 4 July 2016.
  7. ^ Browne, Clayton (4 August 2015). “Kijani Fund Seized As Belvedere Management Probe Expands”. Value Walk. Retrieved 4 July 2016.

The Eco Resources Fund PCC plc (in liquidation)

Posted by Expat Investment Fraud on with 0 Comment

Update:

On 09 July 2019, Nick Halsall of PricewaterhouseCoopers LLC was appointed as joint liquidator of the Eco Resources Fund PCC plc (in liquidation). On the 27 March 2020 Michael Simpson resigned leaving Nick Halsall as the sole Liquidator. Mr Halsall’s contact details are below:

Nick Halsall

PwC | Partner

Phone: +44 (0) 1624 689680

Email: erf@iom.pwc.com

PricewaterhouseCoopers LLC

Sixty Circular Road, Douglas, Isle of Man, IM1 1SA

 

On 16 March 2017 His Honour the Deemster Doyle sitting in the High Court of Justice of the Isle of Man heard an application from the Isle of Man Financial Services Authority (“the Authority”) seeking an order to wind up the Eco Resources Fund PCC plc (“Eco”) under sections 162(6) and 164(1)(d) of the Companies Act 1931.

• 162 Circumstances in which company may be wound up by court

A company may be wound up by the court if —

(6) the court is of opinion that it is just and equitable that the company should be wound up.

• 164 Provisions as to applications for winding up

(1) An application to the court for the winding up of a company shall be by petition, presented subject to the provisions of this section either by the company, or by the Treasury, or by any creditor or creditors (including any contingent or prospective creditor or creditors), contributory or contributories, or by 10 or more policyholders in the case of an insurance company, or by all or any of those parties, together or separately: Provided that —

(d) If it appears to the Financial Services Authority, from any information or document in its possession, that it is expedient in the public interest that a company should be wound up, it may, unless the body is already being wound up by the court, present a petition for it to be so wound up if the court thinks it proper for it to be so wound up.

His Honour the Deemster Doyle granted the applications by Orders, and appointed Mr Gordon Wilson of CW Consulting Limited as deemed Official Receiver and Provisional Liquidator of the Eco Resources Fund PCC plc.

The judgement in this matter is now available to view on the High Court website as follows: https://www.judgments.im/content/J1862.htm

On the 14 July 2017 His Honour the Deemster Doyle considered the Applications and granted by Order the appointment of Mr Michael Simpson of PricewaterhouseCoopers LLC as Liquidator of the Fund. Contact details for Mr Simpson are set out at the end of this statement.

Eco is an Isle of Man Qualifying Fund that launched in July 2012. It was incorporated under the Companies Act 1931 with a reference: 127199C. Eco invested indirectly, via a special purpose vehicle, ERF Limited, into bamboo plantations in Nicaragua and South Africa. ERF Limited invested in loan notes and equity stakes on behalf of the Fund.

Eco has had liquidity issues over a protracted period (since 2014) and has been trying to raise long and short term financing. As at 20 December 2016 Eco had cash resources of GBP 12,545.73 and had accrued debts of over USD2 million. .

In making the application to court the Authority took the following into account:

1. On 16 December 2016 the High Court in the Isle of Man appointed an inspector to Eco.

2. On 20 December 2016, following a shareholder vote against the liquidation of Eco all three directors of Eco resigned as they felt the result was a vote of no confidence. The proposed new directors have since refused to act, leaving the fund without a governing body.

3. On 22 December 2016 the Authority appointed Mr Gordon Wilson to assume control of the affairs of the Fund.

4. The Premier Group (Isle of Man) Limited is itself in liquidation and resigned as manager of Eco on 7 February 2017. This led to the tripartite agreement being terminated and as such Moore Fund Administration (IOM) Limited are no longer appointed as administrator to the Fund.

5. The Fund’s Custodian (Kleinwort Benson CI) has given notice to terminate its services.

6. The Company Secretary resigned with effect from 9 March 2017, leaving the fund with no functionaries.

7. The Fund is unable to pay its debts as they fall due:

  • The Fund’s former administrator has not been paid since the beginning of 2016.
  • The Manager has issued a statutory demand for outstanding fees. The Fund has confirmed in writing that it is unable to pay this debt.

Regulatory Action Taken to Date

Eco has had two Directions imposed by the Authority since September 2015. The first, under 12(1)(d) of the Collective Investment Schemes Act 2008, concerned disclosure to potential investors and the second, under 12(1)(c ) & (d) of the Collective Investment Schemes Act 2008, concerned bringing resolution to the solvency issues Eco was facing.

On 30/06/2016 the Authority appointed Mr. Gordon Wilson as Advisor to the fund under Regulation 13(1)(a) of the Collective Investment Schemes Act.

Following his initial assessment his appointment was extended to take control of the affairs of Eco on 15 July 2016. Mr. Wilson relinquished this role on 5/8/2016, but remained an Advisor to the fund until 22/12/2016 when his role was again extended to take control, following the resignation of all directors to the fund.

On 16 December 2016 His Honour, Deemster Doyle sitting in the High Court of Justice of the Isle of Man heard an application from the Authority seeking an order that an inspector be appointed to the fund. Deemster Doyle granted the application and appointed Paul Shimmin, of Shimmin Wilson & Co., as Inspector of Eco.

The Authority has received a number of reports from Mr. Wilson and is awaiting the results of Mr. Shimmins inspection.

Date Suspended

Redemptions – April 2015. Subscriptions – Dec 2015 (All but institutional investors).

Date of Last Audited Accounts

The last audited accounts were to 31 December 2014.

The Authority’s remit for unregulated collective investment schemes

The Authority’s remit for unregulated schemes is to register them, receive notifications of changes and supervise their appointed Isle of Man functionaries. As such schemes are unregulated, they cannot be sold to the general public. The Authority is notified post-facto of the funds creation so has no ability to opine on structure or feasibility of the fund. Unregulated collective investments schemes are typically higher risk in terms of their investment profile and gearing. The Isle of Man Qualifying Fund regulations require that all relevant risks are made known to, and are accepted by, potential investors and that those involved in the promotion, management or administration of a fund are properly licensed and experienced.

Access to such funds is only available to investors who confirm that they meet the fund type’s minimum entry criteria. This includes a statutory certification that they have read the scheme’s offering document and understand and accept the specific risks associated with that type of fund, such as risks surrounding the underlying investments associated with these types of funds and the risk that investment could result in a loss of a significant proportion or all of the sum invested. The Offering Document of such funds also make it clear that the fund is not subject to any approval by the Authority.

The Authority is responsible for a range of scheme types ranging from regulated funds designed for retail clients to unregulated funds designed for experienced/ qualifying investors. The level of regulation is commensurate with the experience level and knowledge of the investor. This is the reason for the statutory declarations that investors must sign in order to access such higher risk specialist and qualifying funds.

The Eco Resources Fund PCC plc is a Qualifying Fund and should not be distributed to retail investors; it was distributed by financial advisers under the pertaining regulatory regime to clients that confirmed they met the minimum entry criteria and understood and accepted the higher risks associated with schemes of this type. Under both Isle of Man and UK legislation, financial advisers who advise clients are required to satisfy themselves that the product is suitable for the particular client.

If an investor is invested directly or indirectly into Eco, the Authority suggests they contact Mr Simpson in the first instance with any queries.

Mike Simpson
PwC | Partner
Phone: +44 (0) 1624 689689 | Fax: +44 (0) 1624 689690
Email: erf@iom.pwc.com
PricewaterhouseCoopers LLC
Sixty Circular Road, Douglas, Isle of Man, IM1 1SA

The Authority also suggests that in the meantime investors may also wish to contact their financial advisor or intermediary.

The Authority has prepared some Frequently Asked Questions, which can be found here.

E-mail enquiries can be made to the Authority at:

fund.services@iomfsa.im

Useful Information

Qualifying Fund

The Premier Group (Isle of Man) Limited – in liquidation

Posted by Expat Investment Fraud on with 0 Comment

An island-based investment fund manager and promoter and its allied funds have collapsed, leaving thousands of investors worldwide facing little prospect of recovering their investments totalling hundreds of millions of pounds, the Examiner can reveal today.

Premier Group (Isle of Man) Ltd, based at Ridgeway Street, Douglas, was established in 2007 and latterly focused on renewable and green investments including recycling plants in the UK.

But as far back as 2010 investors had been raising concerns about the fund group it succeeded, also named Premier Group IoM, which was launched in 2001 and had seen funds that it promoted grow to £500m but closed to new investments in 2005.

The Premier Shareholders Group accused the Manx government of failing to protect investors after a fund marketed as ‘low risk’ was subjected to a market value adjuster. That 2001 company was not regulated by the island’s Financial Services Authority.

But now the 2007 company that succeeded it – which was licensed and regulated by the FSA as both a fund manager and promoter – has been wound up at an extraordinary general meeting and Craig Mitchell and David Craine of Brown Craine and Co appointed joint liquidators.

It was resolved by the shareholders that the company be wound up voluntarily as it could not continue in business due to reduced sources of income.

However, directors Michael Richardson and Jamie Sutton declared the company would be able to pay its debts in full within 12 months.

Joint liquidator Craig Mitchell told the Examiner: ‘The directors have reviewed the company’s financial position and they consider it is solvent and they are saying there are enough assets within the company to pay all the creditors in full.’

Mr Mitchell said it was an unusual situation as the FSA would be petitioning the court for the liquidation process to be carried out under the supervision of the court.

Premier Group (Isle of Man) Limited was the appointed manager of the New Earth Group of Funds, which went into liquidation in June and an official receiver appointed following an application by the FSA.

The New Earth group, comprising New Earth Recycling and Renewables (NERR), Premier Investment Opportunities Fund and Eclipse Investment Fund, invested in the development and ownership of recycling facilities in the UK.

Premier Group (Isle of Man) directors, actuary Mr Richardson and John Bourbon, a former head of supervision at the island’s Financial Supervision Commission, were also directors of the New Earth Group companies.

NERR and its two feeder funds, had a valuation of $292.22m and a total of 3,249 investors, the majority of whom are unlikely to get much of their money back.

The higher risk nature of the funds was explained in the funds’ offering documents. ‘Substantial recovery of value from those investments may be unlikely,’ says the FSA.

The FSA filed a claim to wind up the three funds after two other linked companies, New Earth Solutions Group and New Earth Solutions Facilities Management, in which NERR was the majority shareholder, were put into administration in the UK.

New Earth Solutions was subsequently sold, safeguarding 143 jobs at the five waste plants it operated.

In another move, the High Court in Douglas, at the request of the FSA, last month appointed an inspector to investigate the affairs, and report on certain matters, concerning Eco Resources Fund.

That fund was set up by Premier Group in 2012 to invest in bamboo plantations and was also described in its offering documents as being high risk.

The court-appointed inspector is to also investigate the affairs of the manager Premier Group (Isle of Man) Limited; the administrator (Moore Fund Administration (IOM) Limited; and the custodian Kleinwort Benson (Guernsey) Limited about certain matters related to the fund.

An adviser previously appointed to the fund by the FSA was made into a controller following the resignation of the board of directors.

Eco Resources Fund had a total of 189 investors and a valuation of $61m.

The fund, which had a complex corporate structure including a minority shareholding in a special purpose vehicle created for the fund named EcoPlanet Bamboo IOM Ltd, promised a ‘guaranteed’ return on investment.

Launching EcoPlanet Bamboo IOM Ltd in 2012, The Premier Group (Isle of Man) Limited described itself as the ‘successor’ of the fund group established in 2001.

A retail investor who purchased shares in the above funds could only have done so after taking advice from a financial adviser.

Michael Weldon of the FSA said that any investor who felt they had been mis-sold investments should consider making a formal complaint to their financial adviser.

 

* It has been suggested to us that the manner of our reporting in the above article may have given the false and incorrect impression that EcoPlanet Bamboo Group LLC (a Chicago based entity, trading as EcoPlanet Bamboo) is related to EcoPlanet Bamboo IOM Limited. For the avoidance of doubt, EcoPlanet Bamboo IOM Limited (the Isle of Man based entity) is not associated with EcoPlanet Bamboo Group LLC (the Chicago based entity), nor its subsidiaries. Further, neither Eco Resources Fund nor EcoPlanet Bamboo IOM Limited have any interest in EcoPlanet Bamboo Group LLC nor in any of its plantations. We apologise for any misunderstanding caused by the manner of our reporting.

If you have purchased New Earth fund through a trustee or direct on the insurer’s platform and have lost money you may be entitled to recover money lost.

Please complete the questionnaire below to see if you qualify.

LM Managed Performance Fund (MPF)

Posted by Expat Investment Fraud on with 0 Comment

LM Investment Management Limited

LM managed investment schemes

On 19 March 2013 the directors of LM Investment Management Limited (LM) appointed John Park and Ginette Muller of FTI Consulting as Voluntary Administrators. On 1 August 2013 creditors resolved that LM be wound up and John Park and Ginette Muller of FTI Consulting were appointed as liquidators. The role of the liquidators is to undertake the orderly wind up of LM.

ASIC has suspended the Australian financial services licence of LM: see 13-075MR.

On 7 April 2015 ASIC extended the initial 2-year suspension of LM’s AFS licence until 2 April 2017.

LM is the responsible entity of the following registered managed investment schemes:

  • LM Cash Performance Fund ARSN 087 304 032
  • LM First Mortgage Income Fund ARSN 089 343 288 (FMIF)
  • LM Currency Protected Australian Income Fund ARSN 110 247 875
  • LM Institutional Currency Protected Australian Income Fund ARSN 122 052 868
  • LM Australian Income Fund ARSN 133 497 917
  • LM Australian Structured Products Fund ARSN 149 875 669; and
  • The Australian Retirement Living Fund ARSN 162 406 162.

LM was also the trustee of the unregistered LM Managed Performance Fund (MPF).

LM First Mortgage Income Fund (FMIF)

On 8 August 2013 the Queensland Supreme Court appointed David Whyte of BDO as receiver of the FMIF.

Mr Whyte will effectively have control of the winding up of the FMIF.

Mr Whyte’s appointment followed ASIC’s intervention in court proceedings heard on 15-17 July 2013 in the Queensland Supreme Court (proceeding number 3383/2013).

These proceedings were initially commenced by two unit holders of the FMIF seeking orders for the appointment of Trilogy Funds Management Limited as the new responsible entity of the FMIF. The Court dismissed this application.

ASIC believes that the appointment of a receiver to the FMIF will allow the winding-up to proceed in the most efficient and cost effective way to provide the best chance of achieving the maximum return for investors.

Download the judgement from the Supreme Court of Queensland’s website

On 20 December 2013 the Queensland Supreme Court made orders in relation to the costs of these proceedings. It ordered that:

  1. Trilogy Funds Management Ltd pay 7% of LM’s costs of the proceeding; and
  2. LM is to be indemnified from the FMIF only to the extent of 20% of its costs of the proceeding.

LM also gave an undertaking that it would not seek from the FMIF any costs of or incidental to the investor meeting convened by notice dated 26 April 2013.

Pursuant to court orders, copies of the relevant court documents, can be found at the following website:
www.lminvestmentadministration.com

An appeal filed by LM Investment Management Limited against the decision of Justice Dalton was dismissed by the Court of Appeal (QLD) on 6 June 2014. The Court of Appeal upheld the orders appointing Mr Whyte as receiver of the FMIF.
Download the judgment from the Court of Appeal (QLD) website

LM Managed Performance Fund (MPF)

On 12 April 2013 the Queensland Supreme Court made orders appointing KordaMentha Pty Ltd and Calibre Capital Limited as joint trustees of the MPF.

On 10 February 2014, orders were made directing KordaMentha and Calibre Capital Limited to wind up the MPF.

For investors or creditors of the MPF, relevant court documents can be found on KordaMentha’s website.

Ongoing status of schemes and additional information

ASIC has been and will continue to liaise with the external administrators and monitor the current status of the managed investment schemes LM operated.

In September 2013 following an application by ASIC, the Supreme Court of Queensland ordered the surrender of the passport of LM’s founder Peter Drake, restrained his travel out of Australia without the prior consent of the Court, and froze his assets. William Fletcher and Tracey Knight of Bentleys were appointed as receivers of Mr Drake’s property: see 13-266MR.

In November 2014 ASIC started legal action against Peter Drake, and former directors, seeking financial penalties and banning orders.

ASIC’s civil penalty proceedings in the Federal Court of Australia are against Mr Drake, Francene Maree Mulder, Eghard van der Hoven, Simon Jeremy Tickner, and Lisa Maree Darcy.

ASIC alleges Mr Drake used his position to gain an advantage for himself and the former directors breached their director’s duties for failing to act with the proper degree of care and diligence regarding transactions involving the MPF: see 14-308MR.

The trial against the former directors commenced on 29 August 2016 in the Federal Court at Brisbane and is due to conclude on 23 September 2016.

On 12 September 2016, after the close of its case, ASIC’s proceedings against the fourth and fifth respondents was dismissed by consent.

On 23 December 2016, the Court found that Peter Charles Drake, Francene Maree Mulder and Eghard van der Hoven did not breach their duties as directors of LM Investment Management Ltd (LMIM): see MR 16-461.

We will provide updates on our website on matters affecting investors as public information becomes available. Consistent with our policy in relation to investigations we are not at this stage in a position to comment further publicly.

Contact details

Investors seeking information about LM and its schemes should contact the appropriate external administrators directly:

FTI Consulting (LM and schemes other than FMIF and MPF

BDO (FMIF)

Investors seeking information about the LM Managed Performance Fund should contact the trustees directly:

KordaMentha (the Trustees)

Creditors seeking information about LM Administration Pty Ltd (In liquidation) (LMA) should contact the liquidators directly:

David Clout & Associates

Investors can also access additional information in relation to the process of winding up on www.asic.gov.au/insolvency-investors.

If you received advice from a financial adviser

If as an investor you have received advice from an Australian financial adviser in relation to your investment and have a complaint in relation to the advice provided you may wish to consider lodging a complaint with the relevant adviser’s External Dispute Resolution Scheme.

You can access additional information about how to complain on ASIC’s MoneySmart website.

If you as an investor received advice from an adviser in another jurisdiction and have a complaint in relation to the advice provided, you may wish contact the regulator in the relevant jurisdiction to discuss whether any further action can be taken.

Taxation inquiries

For any tax-related questions or concerns, please contact the Australian Taxation Office on 131 020.

Reporting information to ASIC

To report information to ASIC on LM, please contact ASIC on 1300 300 630 or go to www.asic.gov.au/complain

Three individuals charged in Axiom Fund investigation

Posted by Expat Investment Fraud on with 0 Comment

21 August, 2020 | Case Updates

The Serious Fraud Office has charged three men with multiple offences in connection with its investigation into the collapse of the Axiom Legal Financing Fund. Timothy Schools, David Kennedy and Richard Emmett are charged with carrying out a fraudulent scheme to divert money from the Axiom Legal Financing Fund for their own benefit.

The case will be listed at Westminster Magistrates’ Court on Wednesday, 30 September 2020.

Notes to editors:

  1. Timothy Schools  (DOB 19.03.1961), a former solicitor, has been charged with three counts of fraudulent trading, contrary to Section 993(1) of the Companies Act 2006, one count of fraud, contrary to Section 1 of the Fraud Act 2006, and one count of transferring criminal property, contrary to Section 327(1)(d) of the Proceeds of Crime Act 2002.
  2. David Kennedy (DOB 07.01.1953), a former independent financial adviser, has been charged with one count of fraudulent trading, contrary to Section 993(1) of the Companies Act 2006.
  3. Richard Emmett (DOB 02.07.1973), a former solicitor, has been charged with one count of fraudulent trading, contrary to Section 993(1) of the Companies Act 2006, and one count of being concerned in an arrangement which facilitates the acquisition, retention, use or control of criminal property by another, contrary to Section 328(1) of the Proceeds of Crime Act 2002.
  4. The SFO announced its investigation on 16 May 2017.
  5. As these are live criminal proceedings, the SFO cannot comment further. The strict liability rule of the Contempt of Court Act applies.

Related Cases

Quilter puts international business under strategic review

Posted by Expat Investment Fraud on with 0 Comment

https://www.internationalinvestment.net/news/4024861/quilter-international-business-strategic-review

Quilter, the wealth manager, has announced it has put its Isle-of-Man-based international business under strategic review, in a statement that sent shockwaves around the industry.

In a statement Quilter said: “In the context of Quilter’s long-term strategy and ambition, the board has initiated a strategic review of Quilter International to evaluate its role in delivering Quilter’s future growth plans.”

“The review is at an early stage and as such the outcome is not yet known. Options range from a decision to retain Quilter International through to a disposal of the business.”

The statement continued: “The board of Quilter has not yet decided on any particular option and as such there can be no certainty that any potential transaction will be concluded.”

The division, which was rebranded earlier this year from Old Mutual International, will be issuing a further market update “when appropriate,” Quilter said.