View more on these topics

SLS liquidator files £59m Keydata lawsuit against US brokerage

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.”


News and expert analysis straight to your inbox

Sign up


There are 3 comments at the moment, we would love to hear your opinion too.

  1. Nick Pilkington 30th July 2014 at 11:21 am

    Will anyone, apart from the lawyers, benefit from this?

  2. Why did the FCA do this, instead of chasing IFA’s, when it was not an advice issue?

  3. I agree with Mr Tired. The reason is probably that they all thought the IFA and their PI insurer were an easy target.

Leave a comment


Why register with Money Marketing ?

Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

News & analysis delivered directly to your inbox
Register today to receive our range of news alerts including daily and weekly briefings

Money Marketing Events
Be the first to hear about our industry leading conferences, awards, roundtables and more.

Research and insight
Take part in and see the results of Money Marketing's flagship investigations into industry trends.

Have your say
Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

Register now

Having problems?

Contact us on +44 (0)20 7292 3712

Lines are open Monday to Friday 9:00am -5.00pm