The Financial Conduct Authority is nearing the end of negotiations in its efforts to secure refunds for investors in a parking investment firm accused of running an illegal collective investment scheme.
Park First offered investments in multi-storey car parks at Gatwick and Glasgow airports, for up to £25,000 ($34,740, €28,762) per parking space.
The firm raised £230m from around 4,600 clients, most of whom were elderly, and promised up to 12% returns.
But in October 2019, the regulator took legal action against Park First seeking to force the company’s senior management to reimburse its clients.
According to newspaper The Times, the watchdog is now close to agreeing a settlement with Toby Whittaker, the owner of Park First and its associated companies.
The terms of the deal are unclear, both in terms of specific sums and whether an agreement could see the FCA drop its legal challenge against the firm.
The FCA said: “In this complex case we have taken civil enforcement action alleging serious breaches of the Financial Services and Markets Act.
“We are committed to ensuring that those running the firms account for their misconduct, including paying compensation to victims.”
Timeline of events
Park First started operating in 2014 selling parking spaces at several UK airports and promising annual returns of at least 8%.
But after the first two years, investors’ returns were not paid.
This prompted regulatory action from the FCA in July 2016, which found that the firm was running an illegal collective investment scheme.
Investors were given the choice between getting their money back or accepting a different lease option that would have cut returns to 2%.
But the volume of clients opting for a refund forced Whittaker to put Park First and the associated companies in liquidation in July 2019, resulting in legal action by the watchdog.
