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FSA wins £32m High Court battle against land banks
by Jun Merrett on Mar 21, 2012 at 09:57
Although the regulator does not regulate the sale of land, land banking that amounts to a collective investment requires FSA authorisation, something Maynard, Countrywide and Plateau did not have.
As the business activities were unauthorised, victims are not covered by the Financial Services Compensation Scheme.
Tracy McDermott, acting director of enforcement and financial crime at the FSA said: 'We have to be realistic about the low probability of securing meaningful compensation for victims of these scams, but this is still an important victory. Proving that a land bank is operating a collective investment scheme - and should therefore be FSA authorised - is very complicated, so every success puts us in a stronger position to tackle other schemes.
"This decision sends a message to other land banks that we will not sit by and let them con investors out of their money. Indeed we have also started court actions against others that we believe have been involved in Maynard’s scheme.'
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