The Financial Conduct Authority (FCA) is taking action against at least 16 firms or individuals who it believes are running or promoting investments illegally as collective investment schemes (CISs).
It has asked the High Court to find that alternative investment firm Capital Alternatives, rice farm harvest promoters African Land and carbon credits investment outfit Reforestation Projects are acting illegally. It is also acting against at least 13 other firms or individuals.
The regulator said it did not regulate the sale of land, property or carbon credits, but does regulate CISs and a firm must be authorised by it to operate them from the UK.
It added it believed the defendants made misleading statements or gave false information when promoting the schemes to investors.
The High Court has ordered a preliminary trial to decide whether the schemes are CISs. The date of this trial has not been confirmed but it should take place in the autumn of 2013.
The FCA said it had obtained undertakings and court orders that freeze the major assets of most of the defendants and prevent them from promoting the schemes while it waits for the hearing to take place.
If the High Court decides the schemes have been run or promoted illegally as CISs, it can order the defendants to pay compensation to the FCA which will then be passed on to investors.
The value of the assets held by the defendants is not clear at this stage.
£1bn business since inception
Considered doing so in 2015
Client communication considerations
Aviva: ‘We are sorry’
FOI from Professional Adviser