Hundreds of investors caught up in an alleged fraudulent investment scheme run by a north-east financial firm have been urged to contact lawyers pressing ahead with a legal action.
Savers who collectively lost up to £9million with Midas Financial Solutions (Scotland) have been invited by Regulatory Legal Solicitors to find out more about the action – which it says will be started initially on a “no-win, no-fee” basis.
Regulatory Legal believes that the number of affected investors is more than 200. The firm has revealed that many people who gave money to Midas were told that their funds were being held in an account with the Royal Bank of Scotland (RBS).
“The end result however is nobody knows where the money has gone and it appears that there was no RBS account,” the firm said.
Police Scotland launched a “large-scale” probe into the scheme in October.
The England-based law firm aims to take its case to the Financial Ombudsman Service (FOA) in the first instance, after the investor watchdog, the Financial Conduct Authority (FCA) said savers would not be able to get compensation for their losses.
The FCA washed its hands of the victims of the scheme after it claimed the investments were not regulated.
But Regulatory Legal argues that the actions of advisers working for Midas should have been controlled by a firm which acted as their “appointed representatives”. The lawyers believe that Sense Network – a financial adviser based in England – “is liable themselves as if they were Midas”.
Sense Network, which ended its relationship with advisers at Midas in August of last year, has claimed it was not responsible for the scheme because neither it nor Midas advisers were regulated to take deposits. In a statement it added: “Any adviser undertaking such activities would have been operating illegally and outside of the authorisation provided by Sense.”
Solicitors at Regulatory Legal say the firm “will be pursuing the Sense Network for failing to control their appointed representative, Midas, and allowing significant consumer detriment to occur”.
The firm said that up to a dozen people caught up in the scheme have joined its action, while a further 50 are considering it.
Tobias Haynes, a paralegal for the firm added: “The total amount of investors is in excess of 200 and we need to reach them to ensure that they are made aware that not all hope is lost.”