Some 62 clients of Gibraltar-based Castle Trust Management Services will be able to sue the company in the UK after a successful appeal in the high court.
The clients allege they received negligent financial advice in 2014 which resulted in over £10m ($12.1m, €11.4m) being transferred from their employer pensions into “inappropriate” and “high-risk” qualifying recognised overseas pension schemes (Qrops).
The 62 investors were not originally given the ability to take legal action against Castle as the Qrops administrator, after a UK high court ruling in 2021 determined that the courts in England and Wales did not have jurisdiction on the matter.
But in October 2022, the investors, represented by High Street Solicitors, appealed the decision and had it overturned in November 2022.
Total losses are still being determined, but the 62 believe the minimum level is currently at £10,215,289.04 – the total sum transferred from defined benefit (DB) schemes into the Qrops. The investors are all from England, Northern Ireland and Scotland.
Castle Trust Management Services, part of the Castle Trust Group, will have until 25 January 2023 to file its defence.
Details
In 2014, the 62 investors were allegedly advised by IFA business Montegue Smythe to transfer, according to High Street Solicitors. But reportedly, the customers were not aware that the company wasn’t authorised by the Financial Conduct Authority (FCA) to provide financial advice on investments, pensions and pension transfers.
High Street Solicitors said once the transfers into the Qrops were made, the investors were allegedly advised to invest in unregulated collective investment schemes.
Sarah Kearney, director at High Street Solicitors, added: “This is an incredibly significant development in this case and we’re delighted that the high court has accepted our appeal and we can now move forward as planned with the case in the courts of England and Wales.
“We’re determined to hold these companies to account on behalf of our 62 claimants who deserve to be compensated for the losses of their pensions that they’d worked hard for many years, as well as the loss of the potential interest that could’ve been made had they been invested into suitable pension schemes.”
International Adviser contacted Castle Trust Group for comment, but the company did not reply in time for publication.
