As the barrister representing the FCA opens the case, a jury at Southwark Crown Court hears that two directors of an investment firm are believed to have lied to their investors in order to make money for themselves.
Collateral (UK) Limited was a finance company which facilitated investments crowdfunded by members of the public. The firm and two related companies entered administration in April 2018.
The two defendants, Andrew Currie, 57, and Peter Currie, 59, both deny two charges under the Fraud Act 2006 and one charge under the Proceeds of Crime Act 2002 in this criminal prosecution brought by the Financial Conduct Authority.
For further information about the case, and to see our reporting of other days please visit our main trial information page.
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Contemporaneous reporting by Alex Varley-Winter who tweets @avwinter
When the online lending platform ‘Collateral’ went into administration it left hundreds of investors high and dry to the tune of – collectively – about £15 million. This week a fraud trial commenced in Southwark against two pawnbroker brothers who both – Financial Conduct Authority (FCA) prosecutors say – ran the business, Peter Currie, 59, and Andrew Currie, 57.
Peter Currie outside court at a preliminary hearing
Prosecuting barrister Stuart Biggs began opening the case to the jury, initially explaining that “the FCA is the UK regulator for financial services and then introducing the legal team for the defendants.
“In a nutshell the prosecution case is that the Curries lied to their investors who invested through the company Collateral, by telling them that Collateral was authorised and regulated by the FCA, in order to persuade them to invest, in order for the Curries to make money.”
The FCA claim that Peter Currie helped his brother Andrew take money out of the company just before it went into administration.
The jury were told how the website worked, with members of the public making their investments on an online platform. Some were investments in property development and others were investments in jewellers or pawnbrokers.
Peter Currie’s background is pawnbroking.
It was explained that from 2016 to 2018 was a time when there was quite a lot of publicity about “peer to peer lending”. Biggs explained that the jury may have seen peer-to-peer lending advertised on the London Underground around that time.
Biggs said that Collateral was set up in the style of a peer to peer lending website, described as quite fashionable at the time, but it was not truly peer to peer because, in peer to peer, lenders and creditors are both individuals, and loans are less than £25,000.
In the case of Collateral some of the borrowers “were businesses and some of the loans were very substantial indeed.”
So the prosecution’s position is, the court was told, that “although it presents as peer to peer it wasn’t real peer to peer lending, in any true sense.”
The jury were told that the number of borrowers were comparatively few, and often the same borrower was listed under different loans. In total it was said, about £15m was loaned through the platform.
About £3.3 million went to a company called Mederco run by a man called Stewart Day.
The jury will “hear from a number of people, some came via investment companies … a wide range of investors” who looked to invest their money.
“In choosing which of those investment firms to go with, a key factor was whether a company was authorised and regulated. The Curries came to realise that, and they guessed that if a company couldn’t say it was authorised then it was going to find it difficult to attract investors. And so they lied. Collateral didn’t have an authorisation to carry out this sort of lending, or any sort of lending.”
“What they did have was a consumer credit license for a pawnbroker … from the OFT back in February 2013, specifically for running a pawnbroking business.”
“But before I go on further it’s important to keep in mind in this case because there is a technical judgment in some of the documents … that you’re going to see. You are not being asked to decide whether Collateral needed authorisation. The FCA position is that they did.”
Mr Biggs explained that in about April 2016 the website goes online and they begin receiving in payments, deposits.
It is “just two years later that the false representation is exposed.”
“In those circumstances, sums that were held in the company’s bank accounts are going to go back to investors and to prevent that from happening to its full extent, Andrew Currie with the help of Peter Currie took two steps.“
Firstly, it is said “The brothers arranged for Collateral to pay £275,000 to a company called Auri Developments Limited, that company was owned by Andrew Currie’s partner Sarah [Louise] Gayton [,41,] and it was controlled by Andrew Currie, and that company was used to make investments in property.“
“That was inconsistent with Collateral’s business model” explained Mr Biggs adding the payments were made right at the end which was “a way to get money out of the company.”
This forms the basis for the fraud by false representation charge.
Secondly, the FCA claim, that between the 13-26 February, £372k was moved from the Collateral bank account to Andrew Currie’s personal account. Those payments were said to have been given narratives on the bank statements “fees payable to Andrew Curry for work as a broker“.
This forms the basis of the money laundering charge ie ‘transferring’ money from one bank account to another.
The jury was told that the investors also ultimately will face losses but “a portion of that will be repaid through the administration/liquidation process.“
Mr Biggs invited the jury to look at the indictment.
“These are the charges made against the two defendants. The prosecution brings the case, the prosecution have to prove them“.
Count 1
Fraud by false representation contrary to sections 1 and 2 of the Fraud Act 2006; the particulars of which that between 12 December 2015 and 1 March 2018 they dishonestly made false representations to investors and potential investors that the Collateral company was authorised and regulated by the FCA, knowing that it was or could be untrue.
Count 2
Fraud by abuse of position contrary to sections 1 and 4 of the Fraud Act 2006; the particulars of which that on or about 15 February 2018 they dishonestly abused their position as directors within Collateral by transferring £275,000 to a company under their control – Auri Developments Limited.
Count 3
Converting criminal property contrary to section 329 of the Proceeds of Crime Act 2002; the particulars of which that between 13 February 2018 and 28 February 2018, they converted credits with a total value of £410,401.69 from Collateral’s bank account to accounts held by the directors knowing or suspecting the same to be proceeds of crime.
Mr Biggs introduces the jury to a couple of the investors’ stories, which he says will be covered in more detail on Friday.
“Let’s look at the website itself, and what people saw when they went on there.”
Biggs directs the jury to screenshots of a page from the website taken by somebody at the FCA who was looking at the site during the life of the company.
“It presents as a proper investment website with attractive rate of interest” with phrases like ‘earn up to 15% interest per year by investing in secure loans‘ and ‘please note there are risks with asset backed investing‘”.
We’re told there is a statement which says “Collateral (UK) Limited is authorised and regulated by the Financial Conduct Authority, Company number 656714 (IP issued) interim permission“.
The jury is shown the short phrase ‘Not covered by FS compensation scheme‘ which Biggs says is “in the small print in the footer but it appears in other places as well“.
An entry on the FAQ section on the website is also shown to the jury.
“Question 18, how is collateral regulated? Collateral (UK) Limited is authorised and regulated by the FCA. We currently have interim permission from the FCA. We previously held a consumer credit licence.“
It’s said that these “were representations being made on the website if you were an investor or potential investor looking at it.”
Biggs asks the jury to look at the bank accounts of collateral saying that in April 2016 there’s nothing in the account. In 2017 “at times there’s over £2 million in the account” and in 2018 “when the balloon goes up … money starts to go out of the account.”
Moving on Mr Biggs says “The FCA has obtained evidence from investors in relation to whether its authorised status was material to them making decisions to invest.’
He continues “The fact of the authorisation was on the website, on emails and it was also … to an extent on Forums [online]. Gordon White [Collateral Staffer] wrote posts on some of those chat rooms [which] again reference the suggestion’“.
The jury were told that an investor called David Bownds said he had discovered Collateral on a forum. “You can look at what he was sent.”
“Page 3 of the terms and conditions in the middle of the page, it says in the middle paragraph on page 3: ‘Collateral (UK) limited is the holder of an interim consumer credit licence. FCA number 616714’”
Page 5 “Collateral (UK) Limited is FCA authorised.“
Page 9 Risk Acknowledgment – “authorised and regulated by the FCA“
“And then again – ‘authorised and regulated’. It was represented over and over again. Confirmation emails with a footer that again says regulated. Mr Bownds received over 600 emails over the period of his investment and he was constantly being given this assurance.“
The jury were told of a number of other investors who say they wouldn’t have invested were it not for the representation of the platform being fully authorised by the FCA. Some of the investors had large sums but…
“There were some which are about £2000, £3000 or so. Sometimes investors would meet the Currie brothers, Suresh Patel started making some investments in Collateral and then in February 2017, he went to Manchester to meet the Currie brothers, and he says throughout all the emails asserted that Collateral was authorised.“
The court was told of another investor, Ivan Zhiznevskii, who in October had telephone conversations with Peter and Andrew Currie.
Biggs explained that “Stephen Findlay of Bond Mason brought £830,000 of client money across to Collateral. They invested £830,000 of their clients’ money with Collateral on the basis that it was authorised and regulated. And it wasn’t.”
Before the creation of Collateral, Biggs said that Peter Currie was director and owner of a company called Regal Pawnbroker Limited.
We were told that prior to April 2014, consumer credit licenses were regulated by an entity called the OFT [Office of Fair Trading]. If you were a pawnbroker you could apply to the OFT for a credit license.
“In April 2014 the law changed and responsibility for consumer credit licensing passed from the OFT to the FCA.”
Whether a company had permission or not was displayed on a Register which was accessible to the public. Because the rules had changed “there were transitional conditions in place, so a firm could obtain something called Interim Permission, while it waited to apply for full permission.“
Applying for full (e.g. not interim) FCA permission “was a more rigorous or complicated process…The evidence shows that Peter Currie knew about that permission“.
Mr Biggs told the jury that “Regal made that application for the OFT license to be converted into interim permission” and referred them to correspondence. One said “Just stick with the OFT for now, as the FCA [don’t] take over [until] … 2014.”
Biggs explains that “sometimes, a business has its official company name but trades under a brand or trading name.“
We’re told the position of Regal Pawnbroker Limited becomes a little complicated as it’s proposed that it could be sold under the name Fitzwilliam Black
The jury is shown an e-mail about the sale.
Rajiv Dhirendra Nathwani, who ultimately becomes a director, asks the Curries: “Can you send me details of the FCA CC [consumer credit] license that you have.”
Peter Currie: “… we didn’t actually receive a certificate or documentation from the OFT. I attach a screenshot from the FCA“.
Biggs continues with the Chronology – the idea, it’s suggested, is to sell Regal with its license, and then change its name to Fitzwilliam Black.
We’re told both Andrew and Peter Currie are involved in that process.
It’s explained that on 25th November 2015, as a part of this deal, Regal Pawnbroker Limited has its name changed at Companies House to the name Fitzwilliam Black Limited.
Biggs comments that this shows the company “moving away from the name pawnbroker”.
While that’s going on, the Curries have moved into a new venture “they’ve set up their Collateral website.”
The jury is told that Peter Currie logged into the Interim Permissions Register, on the 12th of December 2015, and changed the name of Regal Pawnbroker to that of a different company.
Biggs shows the jury the FCA Exhibit – the timeline of logins to the Interim Permissions Register on that day (12 Dec).
“2.24 pm, there’s somebody using Peter Currie’s login, logged into the system and added in a trading name of Regal and the trading name he added was Collateral.”
“Now,” Biggs says, “the trading name can be legitimate, companies use trading names because they want to rebrand.”
“For a moment he changed the details by entering Collateral as a trading name, but he thought better of it because then he deleted it.”
On the timeline – 8th October 2015 at 17.02, “we see a new change at Companies House,” consistent with a sale.
Biggs: “The change of name on the FCA’s register to Fitzwilliam Black is never made. That would have been the legitimate change.” Instead it’s said he changed the name from Regal Pawnbroker Limited to Collateral (U.K.) Limited.
“That’s a false representation because it wasn’t Collateral (UK) Limited. Collateral wasn’t even a pawnbroker.”
It’s said they made the misrepresentation in emails, and verbally, but “this was an extra level wasn’t it because it’s now a change to the FCA Website.”
Biggs: “Back in August 2015…” he begins, referring to a brochure which contains the statement ‘Collateral is not regulated by the FCA’ “so, what happened?” he asks.
Biggs refers the jury to an email from a solicitor advising a potential investor. The court is told it says “Whether it needs regulation by the FCA is something I haven’t considered yet.”
We’re also told about a high net worth investor who got in touch on 11th December, “the day before that change to the Register.” They are considering a potential personal investment of £30,000 with the prospect of £650,000 following.
The solicitor is said to have advised Currie to “strike while the iron is hot”.
The name is changed the following day. “From that point on the representation is repeated and repeated and repeated” Biggs says.
Addressing the jury Biggs says they are not expected “to make a decision as to whether what Collateral was doing required authorisation” adding “nobody’s expecting you to become an expert in financial regulation.“
It’s explained that only an authorised person is allowed to carry out regulated activities. This is “to ensure activities comply with the rules set out in the Financial Services and Markets Act.“
The jury are told that one of the activities is something called a ‘Collective Investment Scheme’. This is described as “where a group of people put their money in, they surrender control of it“, then the funds are pooled.
The second is described as an ‘Electronic Lending System’. “This is really intended for the classic Peer to Peer Lending [model] where lenders and borrowers are then matched through the internet. […] the credit provided is lower than £25,000” and “the borrower has to be an individual rather than a business.“
Biggs introduces Collateral’s solicitor at DWF at the time, Richard Tall.
“What we see is that the FCA have one view and Richard Tall had a different view at various times, and that debate was going on.
“Peter and Andrew Currie were in a number of ways engaging these experts [but] never told them that they changed the name and that the background to this was that they had a consumer credit license for a pawnbroking company.“
“The fact that solicitors and the consultants didn’t know“, it’s said, was something that the solicitors and the consultants, Simply Biz, then relied on.
An e-mail from Connor Thompson of Simply Biz said “Good morning Peter, … I would be grateful if you can confirm the following. … Please give … the details of your interim permission and your landing slot”. Firms with interim permission were given ‘landing slots’ at the FCA in order to apply for full authorisation.
Peter Currie replies: “I can confirm that the firm has interim permission”, while attaching a screenshot of the entry on the FCA website.
Biggs: “because he changed the register it shows as Collateral. It does still have the Regal Pawnbroker email address as the email for Peter Currie.”
Biggs showed the jury Andrew Currie’s representation of himself on the application form when asked if he had ever filed for bankruptcy or had a company wound up or made insolvent. “Both boxes yes and no were ticked.”
Biggs explains that Andrew had been disqualified as a director in the past.
When asked if he had prior convictions he had ticked ‘no’ but in fact he had two completely unrelated driving convictions. “He’d been bankrupt, he’d been disqualified, there was an issue with other convictions although they may not have mattered”.
The court was shown an e-mail sent to Peter Currie which asked: “can you provide details of all the questions where Andrew’s answered ‘yes’?…we need further details about the matters in Andrew’s past.”
Peter Currie replied: “Hi Mark, please see the completed form A for myself. Andrew has resigned as a director of the company and is no longer a shareholder.”
“Those are the circumstances under which Andrew Currie comes to resign as a director of Collateral.” The FCA say “this was purely a matter of convenience to get the application through. He continued to be paid a small monthly salary and he continued to appear in correspondence and he continued to be described to the FCA as a business development person by his brother. That’s the prosecution case that the removal of him from the directorship is really a matter of convenience“.
On 29th March 2016 it’s said Peter Currie is named as a point of contact for the firm, he also answered some questions. On the application form, under interim permission details he’s asked “’Does the applicant firm already hold interim permission for consumer credit?‘ Even if the company has a similar name, you should answer no. He answered yes.“
When Gary Kershaw of Simply Biz found out about the change of the company name on the interim register he said in an e-mail:
“I have to say this represents a very significant change of events. I’m a little surprised that it’s taken the FCA so long to spot this but also that there has been no correspondence to this effect to date”.
Biggs confirms Gary Kershaw will give evidence as a witness.
On 30th January 2018 Richard Tall, solicitor for Collateral, emails. Biggs says “he’s just discovered that they never had interim permission in the first place“.
The court is told that Tall’s said “This email unfortunately is blunt in terms of what this means. This is serious I’m afraid …“
“The other thing they’ve picked up is about Andrew.…If I were the FCA I would be running the line that all of this has been done to mask his involvement.”
“You’re going to find it very difficult to run the line that this is an innocent mistake...Essentially to do that you would have to be 18 years old and not have been in business before.“
“I think the chances of us getting authorised now would be [zero]“
Biggs remarks that “it’s obvious from that isn’t it that Mr Tall is taken by surprise“.
[The court adjourned for lunch]
Stuart Biggs, barrister for the FCA, continued to open the case. He showed the jury Collateral’s Business Continuity Plan.
In the table of personnel Andrew Currie’s name appears and his role is down as ‘Business Development’ “although he wasn’t down as a director. His name does appear there.“
“There’s a concept called a client account, where you keep client money, as opposed to the business account.“
The jury is shown an email from Peter Currie to the FCA providing the client money procedures.
“You should get a document which is headed Collateral what it says is Client Money Policy. This policy contains important information relevant to investors.“
The policy is said to have contained the statements: “Any money that we receive from investors will remain the property of the clients as we hold … FCA rules require that client money is kept separate to our money. … we are required to keep client money separate from our money at all times.“
The court is told the Collateral UK client account at Santander and all withdrawals of funds from the client account are “not to be pulled out without a prior authorisation process“.
Mr Biggs explains that on 29th January 2018 there was correspondence to Collateral from the FCA following the discovery of the change to the Interim Permissions Register.
The letter of 29th January said:
“I’m introducing myself as the new case officer for Collateral. The first prior matter I wish to raise is the registered status of Collateral UK Limited.”
“…Applications for Interim Permission were to be submitted by the 31st March 2014. Companies House records show that Collateral was incorporated on the 27th November 2014 … It was not legally possible to apply for interim permission.“
“… you logged into the FCA’s … It’s not possible to transfer an IP granted to one legal entity to another legal entity.“
“Collateral must … remove all reference to the firm being authorised [from its website].”
Then the jury were shown an e-mail from Richard Tall about what they should do next: “we need to do something. I think the next thing is them going to get an injunction against you.”
Biggs: “Richard Tall was then pursuing Peter Currie for the investor information and he says at the top of this chain … the reason … they’ll suspect that Andrew has an interest in this.”
And “we aren’t going to be able to fob this off.”
Richard Tall then writes to the FCA.
“We act for Collateral, we’ve been instructed to reply to your letter of the 29th [January]“
“Our client acknowledges that changes to the register were made. … misunderstanding. … Not with the intent or desire to mislead anyone, but simply in the interests of corporate expediency.”
“This was not a perception that it wished to create” later adding blaming “innocent naivety rather than with the wish to cause anyone any harm.”
Under “Next steps” we’re told the e-mail said:
“It will continue to operate the platform but that will only be open to lenders exceeding £25,000 and that will only be open to businesses.“
An e-mail dated 12th Feb at 11.36 confirmed the withdrawal of the application for authorisation.
Almost three hours later, at 14.16, an email is sent from Peter Currie to the FCA:
“I also confirm that will cease carrying on any lending activities or facilitate any agreements through the website.“
Richard Tall, Collateral’s legal advisor send an e-mail:
“Peter, please see agreements attached, get the notice up now. The point of getting the notice up is that it shows investors what’s happening.“
The notice didn’t go up.
The draft notice said that “with immediate effect” Collateral has ceased operating.
“We were operating under the belief that we were registered under the Financial Conduct Authority rules. It has transpired that that wasn’t the case.”
The draft notice is sent to their case officer at the FCA.
“Please see the attached amended terms and conditions and [notice] to customers. … could you please advise.”
The case officer replied on 12th Feb “I shall be in touch as soon as possible”
The FCA sends another e-mail on 13th Feb: “Further to my email of yesterday at 15.27 please can you provide an explanation of when you’ll provide the client data.”
The reply that comes from Peter Currie is “I’m taking further advice on your requirements”.
Biggs: “The FCA were asking for client information so that they could speak to investors.“
While the FCA were chasing for details of the investors, it’s said £270,000 was being paid out to Andrew … “no coincidence that Peter Currie was playing for time“, the prosecution say, because “there was a lot going on“.
Biggs: “The Key Question for Count 1 [fraud] was this ‘could the Curries have honestly believed that Collateral was authorised?’“
It was the prosecution case that they wanted to trade off the credibility of their authorised status. “Their application may not have been successful because of the relationship between the Curries and some of the borrowers. [but] it would have been fraudulent even if the business was a success.“
Having received that correspondence from the FCA, it’s claimed Peter Currie did a number of things.
Firstly, he engaged Refresh Recovery as an administrator – The “administrator was agreed by the 21st Feb and company entered administration on the 28th Feb.“
The jury were shown an email being sent from Andrew Currie to Peter Currie and Gordon White at Collateral.
The e-mail dated 28 Feb 2018 “shows that was Andrew Currie arranging the administration“.
It’s claimed that on 14th February £275,000 is moved by the Curries from the Collateral client account and paid to a company called Auri Developments Limited. Auri is owned by Sarah Gayton with whom Andrew Currie lived.
Two properties were purchased. One in Fleetwood and the other on the Torres Golf Resort in Spain.
Biggs: “There was no loan agreement, the loan was simply taken from the Collateral client funds, at the time when Collateral was due to go into administration.“
“Both Peter and Andrew Currie were in a position of trust.“
Peter Currie was the sole signatory to the Collateral … bank accounts, whether he had to sign, I don’t know, but he was the sole signatory.
“There’s a further twist to this…” the Fleetwood property “wasn’t in fact finally purchased until the 18th of March.“
The Spanish property was said to have been purchased on 5th April.
“And by that point, the FCA had found out about the appointment of the Refresh administrator. And by this point the FCA were in legal proceedings trying to remove Gordon Craig as the administrator of the company.“
Biggs: “It’s particularly galling, the prosecution say, that while that was going on, the property purchases were being concluded in Fleetwood and in Spain, initially by Auri and then by another company.“
The FCA compared them to the schedule of loans. … Auri was “dissolved in September 2018“. “The only thing that Auri seems to have done was receive this money. … Then the FCA discovered that Sarah Gayton and Andrew Currie were obviously in a relationship.”
“She provided to her bank the same address that she provided to HMRC. … just over £5000 was withdrawn in cash, just over £4000 was spent in shops” and “£122,000 purchasing the property in Fleetwood. [the rest on] rent, shops, cash etc.“
“Ms Gayton was served with a demand by the FCA to provide documentation related to” the purchase of the Harlequins Nightclub in Fleetwood.
“It’s quite a strange situation because Collateral is giving Auri the money at a time when Auri doesn’t yet own the properties. … eventually it’s purchased by ND Holdings, another company controlled by Ms Gayton.“
Meanwhile, there’s a court hearing for the Curries with the FCA. “It’s at that hearing that Andrew Currie and Peter Currie give undertakings about protecting the money in Collateral“.
“That’s the day that the FCA received an email from the Curries, there can have been no question on their mind that the FCA wanted to protect, ring fence … all of Collateral’s money.“
With regards to the £218,000 payment being made. “There’s no suggestion that the purchase of the house in Spain had anything to do with the Collateral business“
Payments are then said to have started being made to Andrew Currie under the guise of fees.
On 13th February, “the day after the FCA says Collateral has been trading without authorisation, £147,477 was paid from Collateral to the HBOS account of Mr Currie.“
Biggs says there are “payments out of Collateral (UK) Limited client account to Andrew Currie with this narrative on the bank statement … ‘broker fee.’“
The “£210,000 into HBOS made up by 3 payments, one on the 13th one on the 18th and one on the 26th.“
It’s said the broker fees are “in relation to various investment properties – Tudor Place, Basil Court, Sycamore Street etc etc.“
“All but one of the payments contained no reference at all to the payment being made to Andrew Currie.“
“It looked as though he was taking a commission on each of the loans.“
“Now it was an odd arrangement, a broker is a person outside of the business, but that’s how it was explained and it wasn’t explained by reference to his name. Broker fees seems to be a way to disguise or distance Andrew as a person running the business.“
“It does appear that these were secret payments because also none of them were declared by Andrew as income in relation to his own tax returns.“
“While this is going on, while these large sums of money are being paid out, Peter Currie makes no mention of the fact that the company is being put into administration.“
Biggs explains that after most of the payments have been made the Curries continue to say “we’re taking independent legal and compliance advice”.
The FCA have written to them “Please explain why you’re not able to provide the clients’ data given that in our phone conversation you said the information would be provided by the 12th of February.”
Meanwhile an investor is being given details of how to deposit money into Collateral. “Poor [investor] appears to have been investing at this last stage when matters have rather moved on.“
However, the FCA have been told there’s “no loan intermediation activities on our platform” and that “based on our conversations with our new advisors …” they are considering taking legal advice / action against their former advisors.
“No mention of taking substantial amounts of money out of the business.”
On 28th February, two days later, the platform entered into administration.
In response to the FCA requesting information about the lenders and borrowers Peter Currie said – “our compliance officer advised us not to provide this information on data protection rules”
On 1st March 2018 “the FCA became aware of information on internet chat rooms that Collateral had entered into administration” and that Andrew Currie had made the appointment.
The FCA discovered that Gordon Craig, the purported administrator, had been a Facebook friend of Andrew Currie since 2014.
Biggs: “The banking evidence showed that a payment had been made to refresh recovery’s account as an administrator.“
On 23rd March, Refresh Recovery published a report to creditors in the context of the administration, in the High Court in Manchester.
“If we go through that document there are some parts worth pausing on. Under the heading ‘background‘”
The jury were told the report stated “In February 2016 Andrew Currie resigned as director and shareholder to pursue other endeavours and allowed his brother to continue to pursue the business and trade alone.”
Biggs: “not true, the prosecution say”.
The report continues: “The group had five different case handlers at the FCA. Despite Mr Currie’s best efforts and continued cooperation with the FCA, Mr Currie was advised to stop all loans.”
“Mr Andrew Currie was appointed director of the group to assist with this better going forward”
Biggs: The report “doesn’t mention the withdrawals of money, it misrepresents Andrew Currie. … that’s the document where Gordon is parroting the instructions he’s received from Andrew Currie and Peter Currie.”
The FCA then succeeded in releasing Gordon Craig as administrator. The administration proceeds with a different company, BDO.
Biggs: “The Curries were interviewed by the FCA on the 3rd of November 2020. Andrew Currie read a prepared statement, he wasn’t aware of any breach of FSMA, that he understood Collateral’s activities were outside the regulations based on advice from Richard Tall … wasn’t aware of any contraventions of the Financial Services Act, Companies Act …“
“Peter Currie denied any awareness … that their activities were outside the regulations.”
“He’d not understood the fact of distinct corporate entities …”
In addition to the “brokers fees to Andrew Currie“
“£88,000 to Refresh Recovery“
“£120,000 consultancy fees to Andrew Currie.“
“Just puts some of this in context so the 12th of February was that letter from the FCA warning that they were aware in breach of the general prohibition.“
“13 Feb – £309,000 broker fees, HBOS to Lloyds.“
“14 Feb – Andrew Currie becomes director“
“18 Feb – payment to Auri Development.“
…
“From the 12th to the 15th of February, £763,259 has gone out of the accounts.“
“£122,000 for the Fleetwood property“
“£120,000 for the Spanish property“
Biggs concluded: “That’s the case as explained by me for today. Mr Robinson, one of the investors, will give evidence tomorrow.”
His Honour Judge Griffith: “I’ll see you tomorrow, 10.30“
The trial continues.
Both Curries deny two charges under the Fraud Act 2006 and one charge under the Proceeds of Crime Act 2002
The first count of fraud alleges they dishonestly made a false representation to investors and potential investors that the company Collateral UK Limited was authorised and regulated by the Financial Conduct Authority.
The second count of fraud claims the Curries abused their positions, in which they were expected to safeguard, and not act against, the financial interests of the company by transferring £275,000 from Collateral to Auri Developments Ltd.
The third charge relates to converting criminal property, suggesting the Curries converted credits to the total value of £372,299.52 to bank accounts owned by Andrew Currie, knowing or suspecting it to be proceeds of crime, namely fraud by misrepresentation.
Case details:
Court 12 Southwark Crown Court
Before His Honour Judge Griffith
19th April 2023
Case number: T20220056
CURRIE Andrew
CURRIE Peter
The Financial Conduct Authority are represented by barrister Stuart Biggs, assisted by Thomas Coke-Smyth.
Peter Currie is represented by barrister Colin Aylott KC, assisted by Ashley Hendron.
Andrew Currie is represented by barrister Henry Grunwald OBE KC, assisted by Oliver Renton.
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Mouse in the Court 
2 thoughts on “Collateral Directors “lied to their investors” jury told [Day 3]”