Jersey £24m investment scam case enters asset recovery phase: report
Assets relating to the disappearance of £24m in a property scam, in which 700 UK investors lost their life savings to a Jersey-based company, are now in the process of being recovered.
Investors in the scam each lost thousands of pounds after being duped into investing into property development schemes, including a project in the Cape Verde islands, which was being marketed as ‘the new Caribbean’, by many holiday companies at the time.
Herald Trust Jersey, which administered companies associated with Arck LLP, was originally publicly castigated by the Jersey Financial Services Commission for its role in the affair in a report by the commission published in 2014, according to a report Jersey Evening Post.
The Arck LLP operation was linked to a scam orchestrated by UK-based fraudsters Richard Clay and Kathryn Clark, who were jailed for ten years and two years respectively by a judge at Southwark Crown Court in 2015 after admitting fraud and forgery charges, the JEP said.
Asset recovery exercise
The JFSC told International Investment that new activity surrounding the case was in relation to the recovery assets, by the liquidator, on behalf of the investors that had lost money in the fraudulent scheme.
A spokesperson for the JFSC, said: “The JFSC has already taken action in respect of Herald Trust Company Limited, relative to the Jersey specific aspects of this case, noting that the mis-selling activity and fraud took place in the UK and has been dealt with there (with custodial sentences part of the outcome).
“At the time of the fraud investigation, the JFSC worked with law enforcement authorities both in Jersey and at the SFO. From a JFSC perspective appropriate regulatory action was taken against Herald Trust Company Limited and the case is closed. This is now an asset recovery exercise being undertaken by the liquidator and we have no further comment.”
Promised returns of 40%
The scheme was run through the UK investment fund Arck LLP, which promised returns of up to 40% between 2006 and 2011 before it went into liquidation in 2012. Upon being sentenced in 2015, Southwark Crown Court heard that Clay, who was aged 50 when he was jailed, had used money from the scheme to buy sports cars, holidays and a yacht.
Herald Trust Jersey, is a name that also appeared in the ICIJ’s Offshore Leaks Database last year as part of the massive Panama Papers data leak.
The private client business from Herald Trust Company Limited, is no longer part of the Herald Group and was acquired in 2014 by Jersey financial services firm JTC. In addition to the deal 27 Herald directors and staff based in Jersey transferred to JTC’s St Helier offices, at the time.
This story was updated at 16.36pm, Thursday 23 March.