fbpx

Always Take Independent Professional Advice Before Investing Your Money

27th May 2020 By

Fraudulent investment schemes are perennially tempting to the unwary and it really does make sense to take independent professional advice before parting with your money. In one case, the High Court found compelling evidence that hundreds of small investors had fallen victim to such a scheme.

About 240 investors claimed to have been lured into a fraudulent commodity trading scheme by marketing literature which promised exceptionally high, and essentially risk-free, returns. The scheme was promoted by an overseas company that was later dissolved. After the scheme was closed, the majority of the investors remained unpaid and collectively lost over 6.5 million euros.

The investors took action against a professional firm of which the company had been a client at the relevant time. The firm was alleged to have recklessly or negligently enabled the scheme and to have induced many of the investors to participate by endorsing it and affording it an air of apparent respectability.

Communications between the firm and the company, as its client, would ordinarily be subject to legal professional privilege (LPP) and treated as highly confidential. At a preliminary hearing, however, the investors argued that LPP should be waived on the basis that the firm had been instructed by the company for the purposes of furthering crime, fraud or iniquity. The firm adopted a position of neutrality in respect of the application to disapply LPP.

In ruling on the matter, the Court was satisfied that the investors had established a very strong and compelling case that the scheme was fraudulent. It bore the classic hallmarks of fraud in that, amongst other things, it offered impossibly high returns, was targeted at smaller investors and was entirely free from regulatory oversight.

Even if the company were not itself the instrument of the fraud, there was a strong alternative case that it had acted as the unwitting tool of another. The Court’s ruling that the fraud exception to LPP applied opened the way for the investors to seek full disclosure in respect of the firm’s dealings with the company.

Source: Concious

Latest News

Court Sanctions Leg Amputation for Man Lacking Mental Capacity

24th April, 2024 By

The courts are often called upon to sanction treatment for patients whose ability to make decisions for themselves is impaired. In a recent case on point, the Court of Protection had to decide whether it was in the best interests of a man with mental health issues to have his right leg amputated above the knee. The man, aged 60, was taken to hospital by his niece. He was found to have an ulcerated leg. He had a history of paranoid schizophrenia, and believed that the sores on his leg...

High Court Grants Parental Order Despite Previous Adoption

18th April, 2024 By

In law, adopted children are regarded as having been born to their adoptive parents. The Family Division of the High Court recently considered whether that fact precluded a parental order being granted under the Human Fertilisation and Embryology Act 2008 (HFEA) in respect of a child born via surrogacy. A couple who lived in the USA had entered into a surrogacy arrangement with another woman. An adoption order naming the couple as the child's parents had been made by a US court and was automatically recognised under UK law. However,...

Flat Owner Not Liable for Pre-existing Structural Issues

16th April, 2024 By

When building owners carry out works on their property, are they liable for damage to adjoining properties that results from pre-existing structural issues? The Court of Appeal recently provided welcome clarification on that question. The owner of a ground-floor flat wished to extend it by building out into his garden. He served notices on owners of adjoining properties, as required by the Party Wall etc. Act 1996. The works caused the rear wall of two adjoining properties to drop by about 2 mm, which led to internal walls and floor...

Challenge to Will's Validity Rejected by High Court

12th April, 2024 By

The best way to ensure your assets will be distributed as you wish is to have your will professionally drafted by a qualified solicitor. In a recent case, a challenge to the validity of an elderly man's will was dismissed by the High Court. The man had previously made a will in 2011, leaving most of his estate equally to his three children. In 2018, by which time one of his sons had predeceased him, he made a further will, leaving the residue of his estate to his other son...