The Financial Services Compensation Scheme (FSCS) is making victims of an illegal investment opportunity run by defunct firm Midas Financial Solutions (Scotland) aware they may be eligible for compensation.
This comes five years after hundreds of investors who lost around £9m ($11.6m, €10.6m) in the scheme united to try to get their money back from the Aberdeen-based firm.
The FSCS has been “investigating the activities of Midas” since November 2019, looking into the “advice given to customers to invest in high-interest short term deposit accounts”.
It is now encouraging victims to register a claim for compensation with FSCS via its website or its customer contact centre.
Investigation
The UK lifeboat scheme said, although it is accepting claims against Midas, they “have not yet been passed” to its processing teams for assessment because the FSCS is “still carrying out” its investigation into the activities of the firm.
The FSCS said in a statement: “Firstly, we need to establish whether there are ‘protected claims’ against Midas Financial Solutions (Scotland).
“For this to happen, we need to know that the firm owes a civil liability to customers that would enable them to sue the firm in court. In other words, that a UK court would hold the failed firm responsible for a customer’s losses.
“Importantly, this civil liability must be in connection with a regulated activity carried out by the firm. Currently, our investigations are focusing on the actions of an [unnamed] individual associated with the firm.
“Allegations of fraudulent activity have been made against the firm and this individual.
“Currently, the FSCS legal team are considering information in relation to the alleged fraud. They want to reach a view on what regulatory breaches may have occurred.”
The FSCS will provide a further update in due course.
Details of scheme
Midas, which was run by Alistair Greig and Ian Towe before it went bust in 2014, operated as an appointed representative of authorised firm Sense Network.
Investors were told by Midas the investments carried “attractive guaranteed returns placed” on favourable terms due to the owner’s relationship with a well-known high street bank.
But the high-interest accounts never existed and, instead, investors’ money was placed into a “Ponzi scheme” operated by the owner of Midas.
