FSA secures interim injunctions and freezing orders to protect consumers from unauthorised land banking firms

FSA secures interim injunctions and freezing orders to protect consumers from unauthorised land banking firms

On Tuesday, 20 December 2011, the Financial Services Authority (FSA) secured interim injunctions and freezing orders from the High Court against companies including St Clair Estates Limited, OFG Investments Limited, Option Land UK Limited, and GIG Properties Limited as it suspects these companies are running a land banking operation.
The firms are believed to have marketed land in Winkleigh Airfield and Decon.
The orders are to prevent any of the companies from selling plots on a particular site of land pending further investigation by the FSA and the conclusion of ongoing civil proceedings. The FSA took this action because it suspects that these companies were running a land banking operation which amounted to an unauthorised collective investment scheme.
The FSA has frozen approximately £850,000 which is believed to derive from customer investments.  
Sales of land are not normally regulated by the FSA but collective investment schemes do require FSA authorisation and none of the companies listed are FSA regulated.
Head of unauthorised business at the FSA, Jonathan Phelan said: 
“This is a further example of the FSA taking action to protect consumers from unauthorised land banking firms and the individuals behind them.”
“Anybody investing in land should always have it independently valued to check its worth. Furthermore, if you are ever sold land as an investment, and on the basis that someone else will manage it for you as part of a wider site, you should seek the advice of a firm that is authorised by the FSA.”
Since 2008 the FSA has obtained injunctions against nine firms involved in land banking. This month the FSA secured a summary judgment in the High Court against Cityshore Commodities Limited (Cityshore) and its director Aaron Walker. The judgment confirmed that Cityshore sold land illegally to UK consumers. 
In November this year, in a separate land banking case, the FSA executed search warrants on nine premises in Kent and Greater London and five individuals were arrested.
Anyone who believes that they may have been contacted by a land banking operation or any other unauthorised financial services provider can call the FSA’s consumer helpline for guidance: 0845 606 1234.
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