The first major lawsuit resulting from the collapse of Keydata has been filed against a US brokerage for its role in the debacle.
The liquidator of SLS Capital, a Luxembourg-domiciled vehicle formed by David Elias that issued bonds which Keydata investors bought, has sued brokerage CRT Capital and two of its executives for more than $100m (£59m), the Financial Times reports.
CRT acted as a financial adviser to SLS and at one point owned 50 per cent of its shares.
According to a complaint filed in a New York district court, the liquidator accuses CRT of fraud, misrepresentation, negligence, breaching its fiduciary duty and unjust enrichment.
The lawsuit – filed by SLS’s liquidator Yann Baden and backed by a group of 900 Keydata investors known as KSLIT – alleges that CRT knew that SLS’s marketing material was misleading, and that it allegedly fraudulently certified that a key financial metric of the bonds was being met when it was not.
KSLIT chairman Tony Lahert says: “After five years, it is really gratifying to see we know have the real miscreants of this fraud in our sights.”
CRT, which is yet to file a defence to the claims, says: “We believe the claims SLS is pursuing against CRT Capital are wholly without merit.
“UK regulatory authorities have confirmed that David Elias misappropriated the assets of SLS Capital in 2008, months after CRT Capital’s advisory engagement with SLS was terminated.”