The Sunday Times has recently reported on
the ongoing saga of significant losses faced by a number of high profile footballers who invested significant sums of money on the advice of their Independent Financial Advisers (IFA’s)
The investigation centres around two individuals; David McKee and Kevin McMenamin who, through their firm Kingsbridge Asset Management, were well known to a number of premier league footballers and had, over the years, accumulated an impressive list of clients
to whom they promoted and recommended various investments and tax schemes.
However, serious doubts have been raised over both the suitability of these schemes and, more worryingly, the transparency of the structures of these investments.
Many of the investments involve what are now notorious film investments schemes. Although the government had historically offered tax incentives designed to entice production companies to create and film major movie films in the UK, there had been increasing
concern that the use of the film production tax incentives was being abused by financial advisers who were setting up schemes with the primary purpose of artificially creating a paper tax loss that could then be used to off-set personal tax liabilities. It
is understood that some of these schemes were set up by the company Ingenious.
Earlier this year it was reported that a number of wealthy investors were bringing actions in respect of Ingenious schemes and that those actions were to also include Coutts.
Another arm to the investigation relates to property investments in Florida and Spain which have been significantly devalued and resulted in yet further substantial losses for the footballers. It is understood that companies set up in Florida and Spain to administer
these property investments were connected to family members of the relevant IFA’s.
It also appears that Coutts had provided loans for some of these investments.
Concerns about investment advice remain very much in the spotlight. Berg have recently commented on both the ongoing internal review by Coutts in respect of investment advice provided to their clients going back to the 1950’s (Coutts having admitted last year
that it may have sold unsuitable and risky investment products to thousands of customers) and the potential risks and pitfalls of the new freedom on pension drawdowns (as discussed by berg in April of this year).
For more information about any of the above or for practical advice on this or any other aspect of banking and financial disputes, please contact our Banking & Financial Regulation Team on 0161 829 2599 or email
(The information and opinions contained in this article are not intended to be comprehensive, nor to provide legal advice. No responsibility for its accuracy or correctness is assumed by berg or any of its partners or employees. Professional legal advice should
be obtained before taking, or refraining from taking, any action as a result of this article.)