London law firm fined £400,000 by Financial Services Tribunal
London law firm Atlantic Law has been fined £400,000 for its part in an illegal boiler room share fraud.
Margaret Cole
The Financial Services and Markets Tribunal has upheld the FSA’s decision to fine Atlantic Law and ban founding partner Andrew Greystoke from working in financial services in any capacity.
The tribunal heard that Greystoke signed off his firm’s approval of 50 UK investment advertisements from four unregulated Spanish stockbroker firms between December 2005 and March 2007.
According to the FSA, Greystoke signed off the advertisements despite having ample evidence to question the professional integrity of the Spanish firms, including consumer complaints, press reports and FSA warnings.
Under the promotions, the Spanish companies targeted individuals who owned shares and offered a free research report on the company concerned. Anyone accepting the report authorised the company to make telephone contact - a technique frequently used by boiler rooms to obtain the personal details of UK consumers
The Spanish firms then subjected the consumers to high-pressure and sometimes threatening sales techniques. Around 130 British consumers complained to the FSA. Their investments totalled more than of £3m, but the true cost of the scam is believed to be much higher.
The FSA’s director of enforcement and financial crime Margaret Cole said: “Atlantic Law and Andrew Greystoke acted recklessly, without integrity and with a complete disregard of the risks to consumers.
“The Tribunal’s decision supports our view that firms and individuals that assist boiler room operators should be brought to task. This has been a hard-fought case into which the FSA has put significant time and resources.
“It will send a strong message of deterrence to other firms and individuals that may be tempted to turn a blind eye to the legitimacy of their clients in exchange for fees or commission.”
Greystoke was described in the tribunal report as a “solicitor of high intellectual ability and considerable experience”.
According to the report, “his career suffered reverses,” and following litigation with Lloyd’s of London he was made bankrupt in 1996. He founded Atlantic Law in 1999 with the firm converting to an LLP in 2005.
The FSA is attempting to crack down on boiler room share scams, which it estimates cost the UK economy around £200m a year. Victims on average lose around £24,000, though its believed that only 10 per cent of victims report the crime.
Greystoke was unavailable for comment.
Readers' comments (3)
martin | 14-May-2010 10:36 am
FSA should investigate offshore law firms based in london. these firms are the main source for tax evasion.
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David Ufuoma Omamogho | 20-May-2010 12:08 pm
Every person is entitled to make a FOPA at some point in his or her life.That is human frailty and nature.
But the important thing is to learn and after the appropriate penal cosequences,dust yourself, pick yourself back up with a new sense of wisdom and clarity and move ahead to your purpose and destiny with even greater vision and passion.
We as our brothers keepers and fellow learned colleagues should be magnanimous enough to give him a second chance.
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Anonymous | 1-Mar-2012 12:15 pm
Yes, as David Omamogho says, "Give him (Greystoke) another chance but strictly after he has paid the required penalties and reimbursed his victims in full. Perhaps he will then realise that crime is not supposed to pay.
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