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Police investigate advice firm over investment fraud

Police are investigating an Aberdeen-based advice firm for allegedly running a fraudulent investment scheme.

The Aberdeen Press and Journal reports that the Economic Crime Unit (Scotland) has sent a letter to potential victims of the scheme, warning that the investigation is “large scale”.

The letter also warns that as an unregulated investment scheme, Midas was “not afforded the protection afforded by regulated products” meaning investors would not receive compensation for their losses.

Police are unable to confirm how many people may have been affected by the alleged fraud or confirm potential losses.

In August the FCA began its own investigation into short-term investments being offered by Midas Financial Solutions, which had previously been regulated as an appointed representative of Sense Network.

However, Sense has since confirmed that it has terminated its relationship with Midas meaning the firm was unregulated as of 11 August.

Companies House lists Midas Financial Solutions as an active company though Police Scotland say the firm is not currently trading.

A spokeswoman for Police Scotland says: “Police Scotland has been made aware of an alleged fraudulent scheme under the name of Midas Financial Solutions by the FCA.

“A criminal investigation has been launched and enquiries are at an early stage.”

Midas Financial Solutions directors Alistair Greig and Ian Towe both declined to comment.

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Comments

There are 4 comments at the moment, we would love to hear your opinion too.

  1. If the firm was regulated at the time it sold any of these products, it wouldn’t surprise me if the FSCS decides that the rest of us must cough up to cover investors’ losses. That’s the way they seem to work these days, is it not?

  2. Julian I agree.

  3. E L Wisty (an only twin) 22nd October 2014 at 10:55 am

    @ Julian

    My understanding is that, if the firm advised clients to invest in an unregulated product, then the FSCS is likely to pay out.

    However, should this be the case if the scheme itself is fraudulent?

  4. But Julian, Midas – like your own company – was *never* authorised. ARs are exempt under the legislation, it’s their principals (Sense, Tenet, etc) who are authorised and carry the regulatory liability (if anyone does in this case). That’s why networks are only as good as their worst AR and blow up with depressing frequency.

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