Adviser banned after investors lose £30m in unregulated property funds

29th August 2014

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A financial adviser who lost £30 million of consumers’ money by investing them in high-risk property funds he had set up has been fined and banned from financial services.

Craig Cameron, a former director of London-based advice firm Burlington Associates has been fined £350,000 and banned from any involvement in financial services by the City watchdog, the Financial Conduct Authority (FCA).

Cameron, who was a director at Burlington between May 2003 and January 2009, set up three high risk ‘unregulated collective investment schemes’ (Ucis) in early 2005.

The funds invested in new property development in Croatia, Bulgaria and Montenegro and during 2005 they were promoted to thousands of consumers without adequate checks being made to ensure they were eligible for these funds.

As Ucis are not regulated by the FCA and fall outside of the scope of the Financial Services Compensation Scheme (FSCS) they are only supposed to be promoted to sophisticated investors and wealthy people who can afford to take the risk of the fund failing – which they often do.

Cameron convinced 800 people to invest a combined £30 million into the funds which subsequently failed.

Tracey McDermott, director of enforcement and financial crime at the FCA, said: ‘Cameron deliberately flouted regulatory requirements, which were designed to safeguard retail investors, in favour of selling high risk Ucis for potentially lucrative gains.

‘The Ucis have failed and the investors, many of whom should never have been exposed to these high risk investments in the first place, have paid a heavy price for his actions.’

It is not the first time Burlington has been in trouble with the regulator over its promotion of Ucis. Two former directors, John Leslie and Jeffrey Bennett, were banned and fined £28,000 each last year for promoting Ucis schemes.

The FCA urged any consumers who had dealings with Cameron, Burlington Associates or Leslie & Nuding/ Burlington Funds – names under which the Ucis were promoted – should seek independent advice about their rights and options.

 

 

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