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FSA wins legal battle against illegal land banking scheme

Mortgage Solutions | 11 Feb 2013 | 15:51

Jenna Towler

The High Court has ruled two men and their two firms, Asset Land Investments and Asset L.I., ran a £15m illegal land bank by operating a collective investment scheme without Financial Services Authority (FSA) authorisation.

High Court London

David Banner-Eve and Stuart Cohen sold plots of land across the UK through their companies, with the promise that investors would make a significant return within two to three years when the land obtained planning permission and was resold.

About 1,200 investments - with some paying between £5,000 and £25,000 for each plot - were told developers were already lined up for the sites. However, to date, no planning permission has been gained by Asset Land.

Mr Justice Andrew Smith found that in giving evidence at the trial, Banner-Eve had been deliberately dishonest and that he knew about the claims his sales brokers were making to investors. Cohen did not attend the trial and had not participated in the proceedings.

The FSA said it would seek orders from the High Court banning Banner-Eve and Cohen for life from selling interests in land banking schemes for business purposes in the UK.

It will also seek orders from the High Court for the payment of at least £15m by Banner-Eve, Cohen and the Asset Land companies to return to investors.

In June 2012 the FSA obtained injunctions against Banner-Eve, Cohen and each of the Asset Land companies freezing their assets and prevented them from selling more land to investors. The assets will remain frozen until the High Court decides the final amount to be paid to the regulator.

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Categories: Regulation
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