An advice firm that gave recommendations that helped clients invest in collapsed overseas property scheme Harlequin is responsible for more than three quarters of a million in Financial Service Compensation Scheme payouts to date.
Earlier this month, Money Marketing reported on numerous complaints over IFA firm Stuart Black Limited’s advice regarding investments into the unregulated scheme’s interests in the Dominican Republic.
While the Financial Ombudsman Service cleared adviser Stuart Black over at least four complaints seen by Money Marketing, including over recommendations to remortgage to access more funds to invest in Harlequin, the FSCS had begun payouts after opening up to claims in October last year.
Data obtained from the FSCS shows that £751,094 has been paid out to date on 11 successful complaints – an average of more than £68,000 a claim. Two have been rejected while three are still in progress.
While the lifeboat fund is only able to pay out a maximum of £50,000 to anyone mis-sold investments, investors can reclaim 100 per cent of their losses where their retirement savings are held in insurance products.
Harlequin marketed and built overseas luxury property developments. Some clients invested in the developments using Sipps.
The Serious Fraud Office charged group chairman David Ames with fraud in February, and alerted clients who were advised to make Harlequin Sipp investments that, if their advice firm had gone bust, they could potentially claim on the FSCS.