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Seeking Investment Advice? Only Authorised Practitioners Can Be Trusted

When seeking investment advice, it is vital to only use the services of authorised practitioners who are highly qualified and regulated by law. As a High Court case showed, it is otherwise all too easy to fall into a fraudster's clutches.

A woman was introduced by an acquaintance to a man who held himself out as an investment specialist. She quickly placed her full confidence in him and entrusted him with £2.1 million, effectively her entire fortune. Less than half of the money was in the event returned to her. She subsequently launched proceedings with a view to recovering her loss.

Upholding her claim, the Court noted that the man was currently in prison, having been convicted of involvement in a fraudulent tax evasion scheme. He was not a regulated investment adviser and undertook none of the checks that would be expected of a respectable financial professional. Due to her lack of financial sophistication, however, she was not put on her guard.

The Court found that the man had deceived her and breached the general prohibition contained in the Financial Services and Markets Act 2000 (FSMA) on the giving of financial advice by unauthorised persons. He also breached the fiduciary duty he owed her.

He and an offshore company, through which he operated and which was at the time entirely his creature, were also liable for breaching the FSMA prohibition by managing, or purporting to manage, her assets. The company also breached the trusts on which it held those assets. The Court made various orders that were designed to assist her in the recovery of her money.

  • "Thank you for the wonderful advice your firm gave us. We will have no hesitation in contacting you should we need any help in the future."

    — Client, Isle of Wight

  • "Thank-you again - you really have been amazing and so helpful and I’m extremely grateful."

    — Client

  • "Parisa - Thank you so much for all that you have done for me, your kindness and patience have made my claim so much easier and explaining everything to me has helped so much. Thank you again."

    — Client, Isle of Wight

  • "Thank you for the wonderful advice Claudia gave us. We will have no hesitation in contacting you should we need any help in the future."

    — Client

  • "The service I received was second to none. I will of course happily recommend you to others."

    — Client

  • "Thank you to Parisa, who phoned me this morning. She was absolutely brilliant, provided crystal clear advice and put my mind at rest. For months I've wondered whether or not I should consult a solicitor and I now feel that I can move forward."

    — Client

The contents of this article are intended for general information purposes only and shall not be deemed to be, or constitute legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article.