Press Release – FCA v Avacade

THE FINANCIAL CONDUCT AUTHORITY V AVACADE LIMITED (IN LIQUIDATION) (2) ALEXANDRA ASSOCIATES (U.K.) LIMITED (3) CRAIG STANLEY LUMMIS (4) LEE EDWARD LUMMIS (5) RAYMOND GEORGE FOX.

30 June 2020, Sheffield, UK

Omid Khub of Zakery Khub Solicitors:

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Our clients, the Second to Fourth Defendants in the above matter are extremely disappointed about today’s decision.  However, they sympathise greatly with those who have lost money on any investments.

Our clients operated as an introducer to a number of FCA regulated SIPP companies and IFAs. Those FCA regulated companies, (and not our clients), invested investor’s money only after approving the investments, and in some circumstances, only after advising upon those investments.

Today’s judgment therefore is an important judgment for anyone in the financial services sector that relies on introducers.

The case is to be tried by way of a two-stage trial and this first trial was concerned with the technical interpretation of the law and the specific financial regulations alleged by the FCA to have been breached by the introducers. 

The High Court in the first trial has adopted a different interpretation of the law to that of the High Court decision in Adams v Options SIPP UK LLP (formerly Carey Pensions UK LLP) – a decision which was handed down by HHJ Dight CBE on 18 May 2020. This brings into focus once again the potential for misinterpretation and misapplication of the law.

Given the approach adopted in the Carey Pension’s decision we are carefully considering the grounds for appeal in this decision.

Our clients intend to appeal the first judgment in this case, before the second trial begins, to clarify the legal position by a senior court once and for all.

– END –

About Zakery Khub Solicitors

Zakery Khub Solicitors specialise in providing advice on complex commercial, corporate, fraud  and a range of other civil legal issues. We are currently instructed on a number of high-profile regulatory disputes concerning matters of a complex nature. 

Press Release – FCA vs. AVACADE – 4 August 2021

THE FINANCIAL CONDUCT AUTHORITY V AVACADE LIMITED (IN LIQUIDATION) (2)
ALEXANDRA ASSOCIATES (U.K.) LIMITED (3) CRAIG STANLEY LUMMIS (4) LEE
EDWARD LUMMIS (5) RAYMOND GEORGE FOX. 


4 August 2021, Sheffield, UK 


Omid Khub of Zakery Khub Solicitors:


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The analysis of Adams and Avacade has now resulted in two different decisions by the Court
of Appeal. For precise details of the difference, please refer to the records of our analysis of
Adams and Avacade as presented to the Court of Appeal on 7 th and 8 th July 2021.


We are carefully considering the judgment of the Court of Appeal, including the view
expressed by Lord Justice Popplewell in relation to those UK consumers who were
introduced by Avacade and Alexandra Associates as being co-trustees of their own SIPPs.


Indeed, on 8 th July 2021, the Master of the Rolls (Sir Geoffrey Vos), expressed concern that
this could be ‘bear trap’. The views of these senior judges, (one of whom sits at the helm of
the Civil Justice System in England and Wales) taken together, reiterates our long-held view
that the claim by the FCA in fact leads to complex applicability of trust laws which
undoubtedly could have significant implications for investors and adds further complexity to
an already complex area of law. We are now considering turning to the Supreme Court for
much needed clarification in this case and in the hope to prevent others from inadvertently
falling into an unclear regulatory trap.


We note that Options SIPP have applied to the Supreme Court for permission to appeal the
related judgment of the Court of Appeal in Adams. We will be advising our clients on their
rights in relation to the same.

-END –

About Zakery Khub Solicitors 


If you are affected by any of these issues including the UK consumer, introducers and the
wider financial industry, we are able to assist and advise you in order to prevent you from
inadvertently overstepping unclear regulatory lines.  


Zakery Khub Solicitors specialise in providing advice on complex commercial, corporate,
and fraud matters, and a range of other civil legal issues. We are currently instructed on a
number of high-profile regulatory disputes concerning matters of a complex nature.

Press Release – Zakery Khub Solicitors: Litigation & Dispute Resolution

RE: FCA v 24HR Trading Academy Limited and MR M F Maricar – Neutral Citation:
[2021] EWHC 648 (Ch).


Fast-evolving Crypto market and FX Trading – (such as ‘futures contracts’, ‘contract for
difference’ and ‘option’ and ‘securities’) is it a Criminal Offence to introduce?
‘Arranging’, ‘selling’ or ‘advising’, which is not always obvious to an untrained
introducer/promoter, could land them in contravention of FSMA 2000 and lead to a possible
criminal offence.


Having been heavily involved in the High Court’s decision in Avacade as reported by
Law360, FTAdviser, Bloomberg, and International Advisor, etc., and more recently in at the
Court of Appeal in early July 2021, we highlighted the implications of being an unregulated
introducer and the danger of inducing UK Consumers to trade in Cryptocurrency derivatives
e.g. CFDs on FX-trading platforms.


Relying on Avacde, the FCA sued Mr Maricar personally. He mistakenly assumed that he
was exempt from introducing consumers to AvaTrade and VantageFX, but little did he know
that he would be held personally liable (albeit traded through his limited company) for
£530,695.00 plus interest and costs, together with an injunction against his company
preventing it from continuing to transmit trading signals. The High Court found that
transmitting trading signals amounted to ‘advice’, and therefore a breach of FSMA 2000 –
see FCA v 24HR Trading Academy Limited and MR M F Maricar – Neutral Citation
[2021] EWHC 648 (Ch).


It is clear that, having considered the effect of the above judgment, all unregulated
introducers
(not regulated by the FCA) must exercise extreme caution and seek
independent legal advice.


For a full litigation risk assessment of your Crypto derivatives (such as CFDs), FX-trading,
financial services introducer business, please visit www.zakerykhub.com email:

[email protected]

The End
22 July 2021

Press Release – Zakery Khub Solicitors’ Dispute Resolution Department

Press Release – Zakery Khub Solicitors’ Dispute Resolution Department:

The Court of Appeal, headed by Sir Geoffrey Vos, the Master of the Rolls, together with Lord Justice Peter Jackson and Lord Justice Popplewell, will hear our clients’ much-anticipated grounds of appeal this morning, over two days. 

We hope the Court of Appeal will clarify the hard-fought regulatory issues in this case which arise out of the application of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 (“RAO”).

This saga relates to the relationship between unregulated introducers and FCA regulated IFAs and pension providers. 

It has always been the case that our clients’, as introducers, ought not to have been singled out and be held solely responsible for the losses alleged to have been suffered by investors, and that the FCA ought to have also brought legal action against the regulated SIPP companies and IFAs who placed the investor in those investments.  The FCA has never given a satisfactory explanation for its unfair refusal to include those companies involved, in these court proceedings, especially having regards for the fact that they played a significant part in placing the investors into those investments, now complained of.  

Our clients have always maintained that they introduced the UK consumer to FCA regulated IFAs and FCA regulated SIPP providers to advise the UK consumer independently and to apply their own discretion to any investment decision. 

The legal battle between the FCA and our clients, and the related dispute in Adams -v- Options SIPP UK LLP (formerly Carey Pensions UK LLP) (“Adams”), have far-reaching implications for the regulated firms and unregulated introducers in the financial industry, across all types of introduced transactions caught by these rules. 

The Court of Appeal recently overturned the earlier decision of the High Court in Adams, which impacts the high profile judgment in our clients’ case. 

Specifically, the Court of Appeal’s ruling in Adams provides a different interpretation of regulated transactions to that of the High Court judgment in Avacade.  This ruling (unless overturned by the Supreme Court), provides unquestionable support for our legal arguments, and accordingly, we have sought additional grounds for appeal, in addition to those which Lady Justice Asplin, sitting as a single Judge of the Court of Appeal, granted to our client in December 2020.  In essence, on any view, the analysis of Adams (as an authority) makes it clear that it is not a regulated activity under the RAO to buy a tree in a SIPP.  This is why we say that the legal authorities set in these two cases has a far-reaching implication for the financial industry, i.e. those who introduce consumers to the IFAs, SIPP providers and the consumers alike.

We anticipate further clarification in this area of law from this heavy weight panel of judges, specifically for the protection of the consumer and financial firms alike.

Notice: This article is not intended to be legal advice to you as a reader, and you should not rely upon it because of the complexity involved in these matters makes the interpretation of the law fact specific.    

If you are affected by similar issues, you may wish to seek independent advice – Omid Khub of Zakery Khub Solicitors can be reached on 0114 303 6567.

Press Release – ORDER made by the Rt. Hon. Lady Justice Asplin

IN THE COURT OF APPEAL, CIVIL DIVISION

THE FINANCIAL CONDUCT AUTHORITY V AVACADE LIMITED (IN LIQUIDATION) (2) ALEXANDRA ASSOCIATES (U.K.) LIMITED (3) CRAIG STANLEY LUMMIS (4) LEE EDWARD LUMMIS (5) RAYMOND GEORGE FOX. 

16 December, Sheffield, UK 

Omid Khub of Zakery Khub Solicitors:


On 10 December 2020, we were successful in obtaining the Court of Appeal’s permission to appeal the judgment of the High Court made earlier this year by Mr Adam Johnson in FCA v Avacade. 

The Rt. Hon. Lady Justice Asplin gave permission to appeal the key grounds relating to the correct interpretation of the law that governs ‘making of arrangements’ under Article 25(2) of the Financial Service and Markets Act 2000 (Regulated Activities) Order 2001.   

The Court of Appeal recognised that:  

“These grounds have a real prospect of success and there is a compelling reason why they should be heard. They concern the proper construction of Art. 25(2) in context and differing approaches in the SimplySure and Watershed cases.”

We were also successful in seeking permission to appeal the High Court’s interpretation of ‘independent advice’ and ‘introducing’ as defined in Article 33. The Court of Appeal held that:

“There is a real prospect of success in relation to the construction of Art. 33(c) and a compelling reason why this matter should be heard.”

Our clients sympathise with anyone who may have lost money on their investments.  They have always maintained that they introduced the UK consumer to FCA regulated IFAs and SIPP providers to advise the UK consumer independently and to apply their own discretion to any investment decision. 

We say that it is grossly unfair that our clients, as introducers should be held solely liable whilst FCA regulated entities and SIPP providers, who received introduction of customers from our clients were not made party to the court proceedings against our clients – clearly, their parts, acts and omissions in the process in which the UK consumer may have lost their investments, have gone unchallenged in the High Court proceedings against our clients.  

We were surprised that the FCA chose not to include regulated SIPP providers and IFAs in the claim against our clients.  Clearly, they played a major part in any losses which the UK consumers may have suffered.  Our clients say that a fair question arises here: why would the FCA not join them to the proceedings to answer for their parts in the process? They feel that they were the proverbial soft target.  

My clients are pleased that the Court of Appeal agrees with us in that there is a real prospect of success in our clients’ appeal on those grounds.  The correct interpretation of the law is important for all concerned. 

We hope that this successful permission to appeal, granted by one of Britain’s most senior female Judges, the Rt. Hon. Lady Justice Asplin, will pave the way for justice for those affected.

– END –

About Zakery Khub Solicitors 

Zakery Khub Solicitors specialise in providing advice on complex commercial, corporate, fraud, Financial Services litigation and a range of other civil legal issues. We are currently instructed on a number of highly complex regulatory and other disputes concerning matters of a complex nature. If we can help you in your dispute, please do not hesitate to contact us at [email protected]