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James Anderson and other sports stars sue Sigma Wealth Management
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by Alex Steger on May 01, 2013 at 11:49
Nine sports stars including England cricketer James Anderson and former Everton footballer Craig Short are suing their former independent financial adviser (IFA) for £7 million.
Anderson (pictured right), Short, as well ex-Blackburn striker Matt Jansen (pictured bottom right), former Norwich defender Simon Charlton and former England cricketer Matthew Maynard are among 16 individuals suing Cheshire-based Sigma Wealth Management.
They allege they received negligent advice to put money into risky, unregulated investment funds.
The sports stars make up nine of 16 cases being brought against Sigma and its former directors Roderick Langham and Lee Hughes.
Langham said: ‘We are defending these cases vigorously. Those defences will be lodged over the next two weeks.’
Hughes said: ‘These cases are being robustly defended and all of them are now in the hands of our legal team and we can’t comment.’
Former England cricket captain Andrew Strauss was also a client of the firm and is understood to be considering whether to sue. News of the claims follows The Sunday Times’ report that ex-England cricketer Paul Collingwood had launched a legal challenge against Sigma over its advice. But Collingwood’s claim is just the tip of the iceberg.
Anderson is claiming £100,000, while Short (pictured below), who played for Derby, Blackburn and Everton, is suing for losses of £1 million.
The sports stars were advised to invest in a number of unregulated funds such as Matrix Asset Backed 2, a hedge fund hit in the credit crunch, and Aramid Entertainment, a Cayman Islands based fund involved in film finance.
Unregulated collective investment schemes (Ucis), to give them their full name, have been the subject of a crackdown by the City regulator. It wants to ban the promotion of the schemes to the general public arguing that they are generally high risk and, because they are unregulated, do not offer investors protection by the Financial Ombudsman Service or the Financial Services Compensation Scheme should things go wrong.
Sigma Wealth Management entered voluntary liquidation last November.
Hughes is now a director of advice firm Tatton Financial Planning which has the same address Sigma had. It changed its name from Sigma Financial Planning in April 2012 and gained permission to trade from the Financial Services Authority the following month.
Langham is not a director at Tatton, which is an appointed representative of the Sense adviser network, but set up a company called Alternative Asset Strategies LLP in February last year. Hughes is also a director of Alternative Asset Strategies, which shares Tatton’s address.
Andrew Eagle, solicitor at Josiah Hincks Son & Bullough, is representing all 16 claimants.
In 2011 Citywire's New Model Adviser® reported Sigma Wealth Management faced negligence claims for over £500,000 from four clients who lost money after being invested in Ucis. Eagle said Sigma settled these claims.