21 Oct 2019
‘Illegal’ Airport Parking Investment Scheme Faces Legal Action from FCA
A failed airport car parking investment scheme has left investors out of pocket. The Financial Conduct Authority (FCA) has now stepped in to take legal action against the company behind the unauthorised scheme, Park First Limited.
Thousands of investors were attracted to what sounded like a lucrative scheme. If they invested £20,000 on an individual parking space at either Gatwick or Glasgow airport, they would receive returns of up to 10% after three years and 12% after five years. It’s believed that approximately 4,500 individuals invested in the scheme, raising £230m in total.
Four of Park First’s related companies have since gone into administration, the car parking schemes collapsing with them.
The FCA has raised concerns about how the scheme was promoted. They believe that investors were provided with misleading information. It is thought individuals were informed that the investment was worth 25% more than the price they would pay. Questions have also been raised surrounding the potential returns investors were told they could expect and how realistic these were.
As such, the regulator will be taking legal action against those responsible, Park First, its senior management and relevant associated companies. It is hoped that the defendants will be ordered to pay a “just sum” that the FCA can then distribute amongst investors by way of compensation.
In addition to this, the FCA also wants a declaration that the scheme was operated and promoted unlawfully by Park First and constituted an illegal collective investment scheme.
In the wake of the failed scheme, finance professionals have been sharing their advice for would-be investors. Patrick Connolly of independent financial advice firm Chase de Vere has said:
“As a starting point, never invest in anything that you don’t understand. If an investment seems too good to be true, then it probably is. And if it is promoted with a very high interest rate then that means it is very high risk.”