Yahoo Finance Ex-cop set to be hit with freezing order over London Capital & Finance scandal
Former police officer Paul Careless is set to be hit by a freezing order on his property after being accused of being a main beneficiary of the London Capital & Finance scandal.
As reported by the Financial Times, the High Court ruled on Monday that it would impose asset restrictions on Careless.
Careless is one of the 15 defendants listed as defendants in a lawsuit issued by the administrator of London Capital & Finance.
The investment company collapsed back in 2019 after an intervention by the Financial Conduct Authority (FCA) following a discovery that London Capital & Finance was marketing unregulated mini-bonds along with misleading promises of returns of up to 8 per cent.
The company sold 16,706 bonds to almost 12,000 bondholders, who collectively invested around £237m.
The collapse resulted in a scandal, which led to several investigations, including by the Treasury, the Financial Reporting Council, and the Serious Fraud Office (SFO).
The administrators, Finbarr O’Connell, Adam Stephens, Colin Hardman and Lane Bednash from Evelyn Partners, launched civil proceedings against the company’s former executives, including Careless.
The case was launched back in 2020 but finally made it to trial this February, which concluded this month against six of the original 15 due to settlements.
Careless was accused of pocketing around £12m after he directed members of the British public to an alleged “Ponzi scheme”. He has previously denied the claims against him.
While the judgment from the trial will be expected to be handed down in the coming months, Mr Justice Miles did grant a request to restrict how Careless can use the money from the sale of his property in the Cotswolds, estimated to be worth about £2.25m.
As reported by the FT, the administrators called on the judge to order that the cash be frozen and not used to cover the his legal expenses, which was heard that it had reached about £2m.
Mr Justice Miles recognised that the order could be “tough” on Careless’s lawyers, who had “agreed to act on credit and now find themselves in the unfortunate position of not being able to be paid”.
The freezing order application was granted, but the final wording has yet to be finalised.
