Rachael Singh, Accountancy Age, Wednesday 21 July 2010 at 10:45:00

Upton & Co to pay back more than £4m to investors after an investigationby the FSA found it was running an unauthorised scheme

An accountancy firm has been ordered to pay £3.7m by the High Court after anFSA investigation discovered it was running an unauthorised investment scheme.

The High Court ordered Upton & Co Accountants, which is owned andcontrolled by ACCA-qualified David Upton, to repay £3.717m to investors on a prorata basis. Upton also agreed to pay further £840,000 in monthly installments of£10,000.

The firm was running a collective currency scheme where investors pooledmoney to invest in foreign exchange markets. However, the FSA claims limitedtrading occurred and little cash was returned to investors.

Margaret Cole, director of enforcement and financial crime, said the FSAcommenced its investigation into Upton & Co Accountants in February 2009 and"promptly" realised the firm was carrying out "unauthorised business". Thegovernment body sought a High Court injunction to stop activity and freeze thefirm's assets a month later. The High Court ruling on how much to repayinvestors was made yesterday (20 July).

"Operating a collective investment scheme is a serious business involving themanagement of a number of investments and requiring FSA authorisation.

"Upton had no business running one of these schemes and the firm riskedmillions of pounds of investors' money - something you'd expect a firm ofaccountants to know better," said Cole.

More to follow.

Further reading:

FTSE100 audits require "significant improvement", inspectors find

Accountantjailed for £1.3m fraud