Harlequin Group is the parent company behind Harlequin Property SVG, the £400m ($509m, €454m) overseas property scheme facing ruin.
Ames, 65, will appear in Westminster Magistrates’ Court on 22 March. He is charged on three counts of fraud by abuse of position.
The charges, relating to activity between January 2010 and June 2015, come just months after Harlequin entered insolvency proceedings – a move likely to result in even greater losses for thousands of investors.
Harlequin scheme
Founded in 2005, Harlequin is an unregulated property scheme based on luxury villas in the Caribbean and other exotic locations. It promised ‘guaranteed returns’ of 10% a year to the more than 6,000 pension savers who invested around £400m into the scheme via financial advisers.
However, the promised returns never materialised. The scheme ran into trouble in 2013 after the Financial Conduct Authority (FCA) issued several warnings, while the Serious Fraud Office announced it was looking into the fund amid several legal cases.
In a statement on Friday, the SFO said investors who put money into Harlequin through a self-invested personal pension (Sipp) and received financial advice from a firm which is no longer trading may be able to claim compensation from the Financial Services Compensation Scheme (FSCS).
To date, the UK’s FSCS has paid out £100m to investors who received poor advice from financial advisers regarding investments in Harlequin, with many advisers being declared bankrupt after failing to cover client claims.
‘Denies any wrongdoing’
Speaking to International Adviser, Ames “vehemently denies any wrongdoing”, blaming the misappropriation of funds from Harlequin on its former building contractor Padraig O’Halloran and accountants Wilkins Kennedy.
“Before the SFO investigation began in 2013, Harlequin contacted the SFO in 2012 when it came to light that Wilkins Kennedy partner Martin MacDonald, Wilkins Kennedy senior manager Jeremy Newman and fraudulent contractor Padraig O’Halloran had provided them with a dossier to instigate an investigation.
“Since that dossier was submitted to the SFO, Padraig O’Halloran has been found liable for fraudulent misappropriation of millions of Harlequin investors’ monies, Jeremy Newman and Wilkins Kennedy settled a Harlequin claim for defamation, and Wilkins Kennedy have been found liable for professional negligence,” said Ames.
“It is also a matter of public record that Wilkins Kennedy advised on the business model and Martin MacDonald was Harlequin’s de facto chief financial officer,” he added.
Harlequin win
Last December, Harlequin Property SVG, won a $11.6m claim against its former accountancy firm Wilkins Kennedy.
However, the judge who presided over the case, Justice Coulson, blasted the conduct of both parties, adding that the money should not be paid directly to Harlequin Property SVG until issues around compensation for investors are resolved.
