The Financial Services Compensation Scheme has paid out more than £750,000 to date following 12 successful mortgage claims against IFA firm Stuart Black Limited.
The claims came from Stuart Black advising customers to remortgage to free up cash to invest in Harlequin, an unregulated property scheme.
Harlequin marketed and built overseas luxury property developments. Some clients invested in the developments using Sipps.
Stuart Black was dissolved in February 2016 and the FSCS began accepting claims against the firm last October.
Data obtained from the FSCS shows that £751,094 has been paid out to date on nine successful mortgage and three remortgage claims against Stuart Black – an average of more than £68,000 a claim.
Two have been rejected while three are still in progress.
While the lifeboat fund is only able to pay out a maximum of £50,000 to anyone mis-sold investments, investors can reclaim 100 per cent of their losses if their retirement savings are held in insurance products.
The Financial Ombudsman Service cleared adviser Stuart Black over at least four complaints seen by Mortgage Strategy‘s sister title Money Marketing, including over recommendations to remortgage to access more funds to invest in Harlequin.
Stuart Black was an investment adviser at St James’s Place from 2001 to 2004, according to his FCA register entry, before setting up his own firm.
The Serious Fraud Office charged Harlequin group chairman David Ames with fraud in February.
The SFO alerted clients who were advised to make Harlequin investments that, if their advice firm had gone bust, they could potentially claim on the FSCS.