Operation Cotton: FCA fail to secure fraud convictions across the board

Lee Adams, June 19, 2015

The extraordinary saga of Operation Cotton – the first prosecution by the Financial Conduct Authority (FCA) – came to an end with the failure of the FCA to secure convictions across the board against all defendants.

The FCA prosecuted 8 defendants for offences relating to the fraudulent sale of land to members of the public using so-called ‘boiler room’ tactics. The defendants ranged from organisers to salesmen to administrators for the string of companies involved in the fraud.

Lee Adams acted for 4 out of the 8 defendants in Operation Cotton, including the company administrator and 3 salesmen.

Although the FCA secured convictions against all defendants charged with operating a Collective Investment Scheme – a little used provision of the Financial Services and Markets Act 2000 with a maximum term of imprisonment of 2 years – it failed to achieve convictions for the headline offence of conspiracy to defraud against several defendants, including two represented by Hughmans.

Counsel instructed were:-

Chris Gillespie and Vivienne Tanchel of 2 Hare Court for the defendant Forsyth;

David Whittaker and Harry Bentley of 2 Hare Court for the defendant Peters;

Leon Kazakos of 187 Fleet Street and Christopher Ware of 2 Hare Court for the defendant Hawkins; and

Samantha Cohen and Richard Paton-Philip of 9 Bedford Row for the defendant Mitchie