More than 500 investors in the EEA Life Settlements fund have joined a $92 million (£60 million) lawsuit against Britain’s Financial Conduct Authority (FCA). The possible class action lawsuit alleges that “unprofessional” comments by the director of the FCA’s predecessor, the Financial Services Authority, about the risk of life settlement investments caused the fund to lose millions in value, forcing it to suspend trading.
According to the lawsuit, the FSA’s managing director Margaret Cole made comments in November 2011 which branded life settlement investments such as those held by EEA as “high risk, toxic products” that should not be marketed to retail investors in the UK. Cole’s comments allegedly sparked several life settlement funds in the UK–including EEA, the largest among them—to suspend trading. Although the FSA subsequently admitted that Cole’s remarks “may have prompted a number of investors to request redemption from funds,” the financial agency has failed to answer questions about the millions lost by investors following her statements.
In February 2014, Peter Lihou, an investor in EEA Life Settlements, set up an Action Group for Life Settlement Investors in order to allow EEA investors to seek compensation for investment losses they allege were caused by the FSA’s statements. In January 2015, investment experts monitoring the case reported that at least 70 investors with a total of $10.8 million (£7 million) invested in EEA Life Settlements had joined the possible class action lawsuit against the FCA. However, by February the group was able to close its registration with 513 investors with a combined $72.5 million (£47 million) in investments made into the EEA Life Settlements fund joining the litigation.
The EEA Life Settlements Action group said that it will send a letter outlining its legal arguments to the FCA in the hopes of reaching a settlement with the financial regulators. The group says that if it is unable to reach a settlement with British regulators, it will file a class action lawsuit to recover investment losses that followed the FSA’s statements about life settlements.
In addition to the roughly $72 million in investment losses sought by EEA investors who have joined the litigation against the FCA, members of the Life Settlements Action group are seeking an additional $20 million (£13 million) in lost returns on their investments. The group calculated this sum based on an estimated 8% annual return on its life settlement investments over a three year period.
The lawyers at Heygood, Orr & Pearson have handled life settlement lawsuits on behalf of investors, life settlement providers, and brokers involved in these investment transactions. Our attorneys have the knowledge and experience to handle your case from start to finish, and will work hard to ensure that you receive the best possible result in your case.
For a free legal consultation about your life settlement related dispute, contact the attorneys at Heygood, Orr & Pearson by calling toll-free at 1-877-446-9001, or by filling out the free case evaluation form located at the top of this website.