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Blue Gate Capital Limited Enters Liquidation Amid Investment Mis-Selling

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Investment mis-selling is a significant issue in the UK, and has been for many years now. The good news is that the FCA are catching up with the companies responsible for the mis-selling, and affected clients are being awarded the compensation they deserve.

The latest firm to come under fire is Blue Gate Capital Limited. Here’s more information about the situation.

Blue Gate Capital Limited – what happened?

In 2009, Blue Gate Capital Limited became operators of the Connaught Income Fund Series 1. This fund provided commercial operators in the property market with bridging finance, and was unregulated.

The Connaught fund collapsed in 2012, and investors lost a combined total of £118million as a result.

The FCA’s findings

The FCA investigated the matter, and found that Blue Gate Capital had failed to carry out appropriate due diligence on the Connaught fund before taking it on. They’d also failed to investigate the potential problems associated with it, thus putting investors’ money at risk.

They also revealed that Blue Gate Capital hadn’t communicated openly with their clients, and that some of the information they provided had been misleading. In December 2020, the FCA stated that they had publicly censured the firm, and ordered it to pay £203,007 in compensation to their investors. Blue Gate Capital were given a deadline of January 8th 2021 to do this.

Only a few months later, the company entered liquidation.

Was this enough?

The FCA were initially planning to issue a £10million penalty to Blue Gate Capital. However, they decided against this course of action, as the firm had declared itself to be “in serious financial hardship”. The far lower figure of £203,007 was based on the profits that the company earned while they were operators of the Connaught fund.

Some believe that the situation wasn’t dealt with very well. An independent investigation was carried out, this time to examine the FCA’s handling of the case, and the report concluded that the regulation of the Connaught fund was “not appropriate or effective”.  It also stated that the FCA could have taken further steps to protect the investors involved.

What action can investors take?

Thousands of investors across the country are adversely affected by investment mis-selling every year. It’s a serious problem, and can result in major financial loss.

Here are some of the common signs of mis-selling:

  • The firm failed to explain the financial risks involved.
  • They didn’t assess your personal attitude to risk.
  • They didn’t take your financial goals into account.
  • They pressurised you into investing.
  • They didn’t explain the investment properly to you.
  • They didn’t present you with a full range of options.

If any of the above sound familiar, and you’ve lost money as a result, you could be entitled to compensation. The easiest way to find out if you’re eligible is to get in touch with the Goodwin Barrett team today. We’ll investigate your case, then let you know if you’re in a position to make a claim. To find out more, call us today on 0808 163 1659 today or email enquiries@goodwinbarrett.co.uk.


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