Uncovering Fraud to Protect an Investor from Liability
Background
Our client, a fund manager, invested several hundred thousand pounds into a promising business venture. As part of the investment agreement, a representative from our client’s firm joined the company as a director—a stipulation intended to ensure oversight and protect their investment.
However, shortly after, the company went into liquidation, leaving our client not only in debt but also personally liable for the company’s outstanding obligations. It soon became clear that the director of the business had defrauded both our client and the company itself, providing fictitious documents, bank statements, and financial reports throughout the investment process.
The Challenge
With the company in liquidation, the appointed liquidator was holding our client liable for the company’s debts due to their directorial role. The liquidator argued that there had been wrongful trading, and with the original director having hidden his assets and walked away, our client was seen as a financially capable party to cover the debts.
Our client approached us to investigate the situation, with the goal of proving their innocence and avoiding responsibility for the fraudulent debts incurred by the original director.
Our Approach
We launched a comprehensive investigation into the individual behind the company, scrutinizing all aspects of the business dealings that led to our client’s liability. Our approach included:
- Surveillance: We used our network of ex-military operatives to conduct surveillance on the individual who had perpetrated the fraud. This allowed us to gather insights into his behavior, contacts, and movements, providing crucial evidence that he was actively hiding assets and had no intention of addressing the company’s debts.
- Forensic Analysis: Our team of forensic accountants meticulously reviewed all financial documents, reports, and statements presented during the investment process. This audit confirmed that many of the documents, including bank statements and profit/loss reports, had been fabricated to inflate the company’s value and deceive our client into investing.
- Background Investigation: Our investigation revealed a pattern of fraudulent activity by the director in his past dealings. This established a track record of deception and provided additional support to our case, proving that our client was a victim rather than an accomplice to any wrongdoing.
Equipped with evidence of fraudulent behavior, fictitious documentation, and hidden assets, we presented our findings to the liquidator, demonstrating that our client had been misled and was not aware of any wrongdoing. This evidence painted a clear picture that our client was not responsible for the wrongful trading and should not be held liable for the company’s debts. We also initiated proceedings to pursue the individual who had orchestrated the fraud, identifying and tracking down assets he had attempted to conceal.
Our investigation and strategic approach successfully absolved our client of any liability for the company’s debts. The liquidator recognized that our client was also a victim of the fraud and agreed to release them from personal responsibility. Additionally, we were able to recover some of the concealed assets of the individual who had perpetrated the fraud, securing a favorable outcome for our client.
This case illustrates our commitment to protecting clients from the financial and reputational damage associated with fraudulent business dealings. By combining forensic accounting, surveillance, and a deep understanding of corporate law, we were able to dismantle the fraudulent scheme and ensure that our client emerged unscathed. At Strategic Resolutions Group, we pride ourselves on tackling even the most complex cases with a unique blend of investigative rigor and innovative problem-solving.
Our approach turned a seemingly hopeless situation into a victory, enabling our client to move forward with confidence and without the burden of unwarranted financial liability.