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Investor liable for repayment of guaranteed returns following fraudulent stock market scheme
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The High Court held that the defendant was liable to repay guaranteed minimum investment returns to the plaintiffs after inducing them to invest substantial sums in a purported stock market scheme, which later collapsed. The plaintiffs were awarded repayment of their capital investments and guaranteed contractual returns, with interest, after the court found that the agreements constituted investment contracts rather than loans and that the defendant's subsequent deceptive conduct, including the production of forged documents, amounted to fraud and deceit. However, the court determined there was insufficient evidence to link the defendant to a third, later transfer of funds made by one plaintiff, and rejected associated claims relating to that transfer. The judgment also refused to award damages in relation to alleged mental ill-health or the commercial failure of the plaintiff's company, citing a lack of supporting evidence.
investment agreement – fraud – deceit – misrepresentation – assessment of damages – repayment of capital and return – interest – High Court – guaranteed minimum return – liability for fraudulent conduct – breach of contract – default judgment – Criminal Justice (Theft and Fraud Offences) Act 2001 – payment out of court – quantum of loss
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