The Financial Conduct Authority (claimant/respondent) –v- Avacade Ltd & others

Wednesday 7th July – Thursday 8th July 2021

The Second – Fourth Defendants( D2-D4) appeal the judgment of Adam Johnson QC dated 30 June 2020 made following a split trial  and the order of Stephen Houseman QC dated 10 August 2020 (consolidating decisions of 31 July 2020, 7 and 10 August 2020), sitting as a Deputy High Court Judge,  whereby the Judge made Interim Restitution Orders against them , made consequential costs orders ; refused to stay the costs orders and made an injunction order.

Appeals lie against orders not judgments : Mr Johnson’s order is dated 14 July 2020. He heard only from the Claimant and the Second- Fourth Defendants. Neither the First nor Fifth Defendant appeared or were represented. The First Defendant is in liquidation (the Liquidator has said it will abide by any decision)

The Judge (inter alia) made declarations that the First Defendant (one of the corporate Defendants, Avacade)  had conducted business contravening provisions of the Financial Services and Markets Act 2000 (FSMA) by carrying on regulated activities, by making arrangements with a view to the buying & selling of securities as defined in Art 25 (2) and advising on investments Art 53 of the FSMA (Regulated Activities) Order 2001 (RAO); and  by making financial promotions contrary to s21 FSMA; and were in breach of s397 FSMA and s89  Financial Services Act 2012 (FSA) by making false or misleading statements.   The Second Defendant (the other corporate Defendant Alexandra Associates, AA) had also contravened the FSMA and FSA. . The Third and Fourth Defendants (Craig and Lee Lummis respectively) were found to have been knowingly concerned in the contraventions of both corporate Defendants (they were directors of Avacade and AA) and the Fifth Defendant (Raymond Fox) was also found to be knowingly concerned in one corporate Defendant . He was a director of Avacade.

The judgment found the corporate Defendants business model was to approach UK consumers regarding their pensions, many of whom then transferred their pensions into self invested personal pensions (SIPP) and then invested in high risk investments.

View hearing:

Day 1

Part 1

Part 2

Day 2

Part 1 (final part)