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The importance of paperwork

Service Area: Fraud

Member: Roger Isaacs

A request for the public’s help in a financial investigation into the demise of London and Capital Finance (LCF) by the Financial Conduct Authority (FCA) highlights the importance of keeping records as evidence.

The Serious Fraud Office (SFO) also urged any members of the public affected by LCF’s closure to keep any relevant paperwork safe.

LCF was the issuer of mini-bonds that it said would be used to make loans to corporate borrowers to provide capital for further investment.

According to the FCA, some 14,000 members of the public invested in LCF’s mini-bonds and there are fears that they have lost the money they invested, given concerns over how the firm conducted its business.

The authorities have now requested that anyone affected by LCF’s closure should keep safe any information, including letters, emails and any financial records they have relating to their investment with LCF and not to share this information with other investors or publish it on online.

The Financial Services Compensation Scheme (FSCS) has also published a fact-finding questionnaire and, in the past month, more than 5,500 people have completed it.

The FSCS says it is analysing the information provided and it is already helping its ongoing investigation into the nature and extent of any protected claims.

Meanwhile, Dame Elizabeth Gloster, who is leading the independent investigation into the circumstances surrounding the failure of LCF, has also urged the public to provide as much information as possible.

The outcome of any investigation will hinge on the evidence provided. Forensic investigators are practised in sifting through this evidence and arriving at a clearer view of what has gone on.

Roger Isaacs, Forensic Partner at Milsted Langdon has spoken at length about LCF on BBC Radio 4’s Moneybox programme.

He said: “It is interesting to see that the FCA and SFO are now taking further action against LCF following the concerns raised previously.

“This is a prime example of where forensic accountants can play a vital role in uncovering and exposing financial impropriety within a business. With investigations ongoing and new evidence being provided daily, it will be interesting to see how this case develops.”

Author: Roger Isaacs 16 August 2019

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