We took Capital Alternatives and several other firms and individuals to court over their promotion and operation of collective investment schemes. We are continuing our action in the High Court. Find out more about this and what it could mean for investors.
Why did we take action?
Collective investment schemes can be a risky investment so only authorised firms and individuals can operate or promote them. This is to protect consumers’ interests if a scheme goes wrong.
We believed Capital Alternatives and several other connected firms and individuals (please see the full list of defendants at the bottom of this page) were promoting and operating collective investment schemes without authorisation. We are taking court action against them, focusing on two investment schemes:
- African Land (also known as Agri Capital) which offers investments in rice farm harvests in Sierra Leone as run by African Land Limited.
- Reforestation Projects (also known as Capital Carbon Credits) which offer investments in carbon credits intended to be generated from land in Sierra Leone, Brazil and Australia and is run by Reforestation Projects Limited.
The court hearings
The High Court decided in February 2014 that the above schemes were collective investment schemes which could not be lawfully operated by the defendants. Some of the defendants appealed, and in March 2015 the Court of Appeal rejected the appeal and also found that the schemes were collective investment schemes. On 28 July 2015, the Supreme Court refused to give the defendants permission to make a further appeal.
What happens next?
The FCA is now proceeding to deal with remaining aspects of the case back in the High Court, including the issue of misleading statements which the FCA alleges were made to investors in relation to these schemes.
Since receiving the Supreme Court’s ruling, the FCA has also been preparing the legal documents needed to continue its High Court claim. At a hearing in June 2016, the FCA asked the High Court to issue a timetable for the case going forward. A trial regarding various issues (including misleading statements which the FCA alleges were made to investors) has now been scheduled. This will take place on a date to be confirmed between 8 and 23 May 2017. Further information will be provided when it is available.
The previous undertakings and injunctions obtained by the FCA from July 2013 onwards remain in place.
What this means for investors
As the court has ruled that these are collective investments schemes which were operating unlawfully, it may order the defendants to pay compensation that can be passed on to the investors. The court will first need to make an order setting out the timetable for the case going forwards. The sixteenth defendant has settled the case on the basis that it will contribute up to £200,000 in total if any other defendant is required to pay compensation. The sixteenth defendant will not take part in any further proceedings.
We will update this page when we know more.
What you should do next
If you invested in either or both of the African Land/Agri Capital or Reforestation Projects/Capital Carbon Credits schemes, you may wish to take legal advice on your individual position. However, you do not have to take any action in relation to the FCA’s case at this stage. We will give you further information when it is available.
In the meantime, please ensure that you retain copies of all documents in relation to your investments, including any certificates and evidence of payments made in relation to the schemes.
Please be aware that the FCA is not seeking repayments from other investments promoted by or related to Capital Alternatives Limited in these proceedings. Investors may therefore wish to take legal advice on their individual position in relation to any other products or schemes they have invested in.
Copies of the judgment
The FCA is not in a position to provide copies of court documents to investors. Any investor who wishes to obtain such documents will need to apply to the court and pay any relevant fees. Copies of the judgments can also be obtained as follows:
- the Court of Appeal judgment dated 25 March 2015 can be obtained from the BAILII website or from the Court of Appeal quoting case number 'A3/2014/0764: 0764A; 0766'
- The High Court judgment dated 14 February 2014 can be obtained from the BAILII website or from the High Court quoting new case number 'HC-2013-000531'
Contact by third parties
We are aware that some investors may have been approached by third parties offering to assist them in disposing of their investments with African Land or Capital Carbon Credits. In some instances these individuals claim to work for, or on behalf of, the FCA. You should be extremely cautious if you are approached, particularly if you are asked to make a payment in advance.
If you think you may have been approached by an unauthorised firm or individual you should contact our Consumer Helpline on 0800 111 6768.
We can confirm that the defendants in these proceedings are:
- Capital Alternatives Limited
- Capital Secretarial Limited
- Capital Organisation Limited
- Capital Administration Services Limited
- MH Trustees Limited
- Marcia Hargous
- Renwick Haddow
- Richard Henstock
- African Land Limited
- Robert McKendrick
- Alan Meadowcroft
- Regency Capital Limited
- Reforestation Projects Limited
- Mark Ayres/Eyres
- Mark Gibbs
- the estate of David Waygood (case settled)