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Robin Forster, the director of two companies involved in operating an unauthorised care home investment scheme has been banned from being a company director for 14 years.
A total of £57 million had been taken from investors and put at risk in the unauthorised scheme. Based in the north-east of England, Qualia Care Properties Ltd and Qualia Care Developments Ltd offered investors the opportunity to invest in care homes. Investors bought a long-term lease on a care home room. The care home was run by a third company, Qualia Care Ltd, who sublet the room back to the other 2 companies.
Investors were promised returns of between 8-10% of the purchase price. However, the Financial Conduct Authority (FCA) successfully argued in court that the scheme was unlawful and amounted to an unauthorised collective investment scheme. The court also agreed that Mr Forster had made false and misleading statements to investors since the promised returns were never likely to be achievable or the scheme itself sustainable.
The FCA is currently seeking to recover the £57 million lost by investors.
To compound matters, during the four days leading up to the two companies going administration, Mr Forster arranged for more than £2 million to be transferred out of the companies into a connected company. This was despite the fact that monies were owed to creditors.
Both factors – running the unauthorised scheme, and depriving creditors of more than £2 million – contributed to the 14-year ban.
News like this serves as a good reminder that as far as investment returns go, if it sounds too good to be true, it probably is!
