Cameron Farley, FSA & Grant Thornton

ritchieboy

In a nutshell I invested £15,000 with Cameron Farley. After a year of hearing how much of a return my friend and his farther were getting on a monthly basis. At the time Cameron Farley were doing this trading in mostly dollars, I met Stephen Farley,went to a seminar in the Hilton and made the decision to invest money that was left to my mother after my Dad died. Shortly after, maybe 2 weeks after the money was deposited, the FSA froze the company. It turned out the company weren't registered or licensed with the FSA even though that was not my understanding.

After a year or so & little communication or useful communication the company was ordered to shut down. I am told the money that was in CF at the time was £134,000,000. So now I am looking at getting 5% back! While Grant Thornton are supposed to be getting £1,000,000 or the asset management or what ever they are doing.

I have called the FSA, get nothing, call GT get nothing, and get the odd "promise" from Stephen Farley. I am going to lose my Dad's money because I was miss-informed and there seems nothing I can do or no-one I can speak to. Seems you can't argue with the FSA.

I can't live with myself, I promised my Dad I would look after my mum, and now I have risked her future. It seems unreal, Banks get bailed out with Billions, if a hamper company go bust and people lose hundreds at Christmas there is an out cry, but the FSA blunder through this company, people have lost houses, been suicidal you name it and we get no help!

It has made me really ill on top of losing my Dad, i broke my promise to him. I am now not working and as I was self employed get no sick pay or little help. I can't sell my house to give my mum the money It seems I lost forever, as I had to self cert when I bought my house & being ill & un-employed.

My only hope is that as the money was paid into a holding account it was never in the amount seized, or lost or where ever it went, but NO ONE can tell me anything. Who can?? Is it right GT's fee come out of the investors money? Shouldn't the FSA have a scheme, make Stephen Farley pay it with his money.

I am lost with what to do, I haven't told my mum that it seems hopeless, I just can't do it.

Can anyone please help me ?

Reaper

That is a sad tale. You have my sympathy but I fear there is little you can do.

I'm not sure where you get £134m from. I found the liquidators report here:
http://www.scribd.com/doc/17741662/EH2-Capital-Cameron-Farley-Liquidation-Report-Ponzi-Stephen-Farley-Fiona-Farley-Edinburgh-EH2-Capital

I've only skimmed it but I think they took just over £18m from investors and now have only £2.5m of assets. However they decide to allocate the payouts that means you are not going to get much of your money back. And yes liquidators take a chunk for their fees. It's galling but necessary.

I see the Farleys paid themselves £1.3m out of the business. I rather feel they ought to pay it back if they deceived people, but I don't know enough about the circumstances. besides even if they paid the whole lot back it would only make a small difference.

The FSCS compensates members who pay in to the fund if one of their number goes bust. Unfortunately as they were not a member it does not apply. Contributors to the FSCS would not take kindly to being expected to pay out for somebody who was not a member and not contributing. Unless the government feels like stepping in and covering it ('fraid not) I see no prospect of compensation.

It's no use to you now but you can check whether a company is regulated on the FSA web site.

Sorry I can't give you any better news.

dunstonh

It turned out the company weren't registered or licensed with the FSA even though that was not my understanding.

Thats the key problem.

Shouldn't the FSA have a scheme,

The schemes that exist are funded by FSA authorised firms to cover wrong doings and issues caused by FSA authorised firms. It does not cover unregulated activities. Firms acting illegally outside of FSA authorisation give you virtually no protection. In effect, its a bit like being burgled whilst being uninsured but hoping an insurance company would pay out. You are effectively a victim of a crime.

I dont know the specifics of the case but I would expect the police to be involved. My understanding is that it appears that some people thought this firm was an IFA authorised to handle client money when it wasnt an IFA and wasnt authorised to handle money.

Indeed, check this thread below and you see people referring to them as IFAs.
http://boards.thisismoney.co.uk/tim/threadnonInd.jsp?forum=98&thread=89597&message=345784

Cameron Farley advertised itself as an introducer 'to financial products and providers'. So basically, it was a pretence by some fraudsters.

Reaper

From skimming the documents it seems they did invest the money. It was used for forex currency trading via a US company called Gain Capital. They did appalingly badly at this and made a £11.5m loss. Despite this they said everything was rosey and went on taking money in and, if I understand right, paying out returns to investors.

EDIT: This was a reply to Turbobob's question but it's gone now.

turbobob

Reaper wrote: »

I'm not sure where you get £134m from. I found the liquidators report here:
http://www.scribd.com/doc/17741662/EH2-Capital-Cameron-Farley-Liquidation-Report-Ponzi-Stephen-Farley-Fiona-Farley-Edinburgh-EH2-Capital

Good find that. Sorry to hear your story OP. Unfortunately I can think of no way that you are going to get more than your share of whatever is left. It seems (from skim reading what Reaper has linked to) that the firm was actually paying the monthly returns from other investors money. The forex trading aspect was actually loss making, if that report is correct.

Some of the investors money was used by a director buy a flat in Edinburgh so I would have thought the value of that would be recoverable?

turbobob

Reaper wrote: »

EDIT: This was a reply to Turbobob's question but it's gone now.

Cheers reaper (sorry for any confusion, I deleted it when I realised the answer to my question "was it a ponzi scheme" was in the document you linked to )

ritchieboy

Thanks guys for your response. As you may have gathered it is an emotional issue for me! I can say without hesitation if I had lost my money, not my Dads (mums) I would sleep easier, but it wasn't.

My information came from other investors which were in regular contact with Mr Farley. At one point he was asking for help with solicitors fees from an investor I know of. He had recently contacted me and I assume the other investors with regards to a payment vehicle! Something about a car park believe it or not. I will go through his e-mails and possibly copy onto this thread for your advice. Of course the guy will not get one cent from me unless he wants to come to my house and collect it!

Thanks again for your advice and info, it's sad in one way that I have got more info from one post on a forum than from the FSA, GT or CF put together but in another way, comforting knowing there are people kind enough to spend a little time helping someone they don't know out.

Rich

Reaper

ritchieboy wrote: »

My information came from other investors which were in regular contact with Mr Farley. At one point he was asking for help with solicitors fees from an investor I know of. He had recently contacted me and I assume the other investors with regards to a payment vehicle!

What a cheek! Asking investors to help out poor impoverished Mr Farley?!!!

If he pleads poverty again I'd ask him to explain the following payments that the company made according to the document I linked to earlier:
Company flat: £439,829
Mr & Mrs Farely - salaries, house deposit, credit cards £1,328,257

Not to mention...
Cash withdrawn: £64,167
Lifestyle payments (huh?) £32,935
Unidentified payments £633,051

I wish you the best of luck but I'd concentrate on your health and job hunting rather than hoping for your money back. Consider anything the liquidators can give you a bonus as there is not much to hand out. And whatever you do DON'T give Mr Farley any more money.

Best of luck to you.

ritchieboy

Thanks again for you help and good wishes.

After being ill as I said for some time I am feeling like i can give this my full attention without it being detrimental to my health.

cameronfarleydebate.co.cc/index.php/topic,14.msg431.html#new

I just quickly found this site and it seems the FSA told Mr Farley to stop trading back in 2007! So it looks like some investors are looking at the FSA for not controlling the situation better and taking action against them. So I'm wondering how I can find out FACTS about this, not forum chat as like myself, it's an emotional issue and facts get lost in emotion I think. And, again it is forum chat, but it seems Mr Farley had a history which the FSA would have been aware of!!

turbobob

I wish you good luck with it. Yes it is no doubt an emotional issue.

Again, this was from skim reading through the report above but one thing that stands out is that a number of disastrous currency trades were initiated on 23 September, which is well after the freezing order was imposed on 2 September (see "The Euro/Dollar Trade"). These were appallingly bad trades in the wrong direction with no protective stops - resulting in a $10m loss when the position was finally closed. Other positions were also open (Sterling/Dollar) without protective stops. This raises questions in my mind, such as why the trading continued after it was supposed to have been stopped and the accounts supposedly frozen?

Reaper

Well spotted. I hadn't read it thoroughly enough to pick up on the fact that the trades were done after the freezing order. That is certainly something that needs to be explained as if it were not for that mind bogglingly bad bit of trading investors would have got most of their money back.

ritchieboy, I wouldn't put too much faith in those forums. I glanced at some and they mostly seem to be full of bad tempered people hurling insults at each other and setting up competing forums as power plays. There are few facts posted and even fewer people doing anything constructive - like getting legal advice.