Alexandra Associates, Craig Lummis and Lee Lummis have been given permission to appeal a High Court ruling, which ordered them to pay back over £10.7m ($14.3m , €11.8m) to the Financial Conduct Authority (FCA).
The regulator would have then redistributed the funds to the investors who suffered losses by transferring their pensions into Sipps.
But Lady Justice Asplin allowed the three defendants to appeal the High Court decision, as she believes they have a “real prospect of success and there is a compelling reason why they should be heard”.
The firm and two individuals argue that they cannot be liable for any losses suffered by investors as they only acted as introducers to FCA-regulated Sipp providers and IFAs, which are the ones who made the investment decisions.
They had already set out plans to appeal the ruling as soon as it came out in August 2020.
‘Soft target’
“We say that it is grossly unfair that our clients, as introducers, should be held solely liable, whilst FCA regulated entities and Sipp providers, who received introduction of customers from our clients, were not made party to the court proceedings against our clients,” said Omar Khub of Zakery Khub Solicitors, representing Alexandra Associates, Craig Lummis and Lee Lummis.
“We were surprised that the FCA chose not to include regulated Sipp providers and IFAs in the claim against our clients. Clearly, those regulated entities played a major part in any losses that the UK consumers may have suffered.
“Our clients say that a fair question arises here: why would the FCA not join them to the proceedings to answer for their parts in the process? Our clients feel that they were the proverbial soft target.
“Our clients are pleased that the Court of Appeal agrees with us in that there is a real prospect of success in our clients’ appeal on those grounds. The correct interpretation of the law is important for all concerned.”
The defendants were also successful in the recusal of High Court judge Adam Johnson on the grounds of conflict of interest.
