The Financial Conduct Authority (FCA) has received approval by the UK high court to return £2.5m ($3.2m, €2.9m) to victims of an unauthorised collective investment scheme.
It involved the unlawful selling of land.
Between 2005 and 2010, Countrywide Land Holdings, James Maynard (trading as Regional Land and Countrywide Land) and Stephen Watkins (trading as Consolidated Land) scammed around £32.8m in from around 870 investors.
The high court ruled in 2012 that the companies had to repay investors, but the FCA has only received £2.5m from the liquidation of a Panama-based firm called Paradigm Consultancy.
The sum will now be distributed to 573 qualifying investors, the regulator said.
“Investments promising high returns means there is a high risk investors will lose their money,” said Mark Steward, executive director of enforcement and market oversight at the FCA.
“Sadly, this is what happened here. We have worked very hard to identify people eligible to receive compensation from these schemes and are pleased to have been able to recover and return some of their money.”
The watchdog did not explain whether the remaining £30.3m is going to be collected and if investors will be repaid in full.
Fraudulent impersonation
Additionally, the UK Insolvency Service has warned that fraudsters are contacting investors claiming to be representatives of the Official Receiver’s office.
They are offering to help with the recovery of funds for a fee.
It said these approaches are always fraudulent, as the Official Receivers would never ask people to pay to recover investments.
“The Official Receiver can only make a return to you as a creditor in failed schemes if it is possible to identify and sell any remaining assets owned by the liquidated company you bought your investment from,” the Insolvency Service added.
“All too often businesses of this nature have few, if any, assets left to repay creditors and it can take several years to undertake complex asset recovery work and complete a liquidation.”
