Unregulated introducers ordered to pay nearly £17.5m restitution to consumers

The order was made on 7 August 2020, commanding Avacade to pay £10m to consumers, Alexandra Associates £750,000, directors Craig Lummis and Lee Lummis were each ordered to pay £2,500,000 and Raymond Fox, another director, £1,700,000.

In a judgment dated 30 June 2020, the Court found that Avacade's and Alexandra Associates' activities were unlawful as they had engaged in the regulated activities of arranging and advising on investments, made unapproved financial promotions through their websites, promotional material and in telephone calls to consumers and made false or misleading statements.

Alexandra Associates tried to appeal the High Court decision, but ultimately was unsuccessful. PA understands the firm planned to go directly to the Court of Appeal instead.

A further hearing then took place on 31 July 2020 to determine the amounts the defendants should pay in restitution for their roles in the unlawful activity.

The Court also found that the Lummises and Fox were knowingly concerned in the two firms' breaches.

More than 2,000 customers transferred around £91.8m into products promoted by Avacade and around £905,000 into products promoted by Alexandra Associates. From the investments the two firms earned commissions in the region of £10.8m. Many of the underlying investments have failed or are in liquidation.

FCA executive director of enforcement and market oversight Mark Steward said: "The FCA will make wrongdoers financially accountable to consumers whom, as the Court recognises in this decision, '…include elderly and vulnerable citizens who have paid their due share of income tax, made sacrifices, and taken prudential decisions for their future retirement over the course of an honest working life.'"

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