Yorkshire solicitors Lupton Fawcett LLP has settled a High Court claim brought by the FCA and apologised for the firm's involvement in an unlawful and unauthorised care home investment scheme which saw investors lose £57m.

The FCA and Lupton Fawcett LLP have settled the claim about the Ponzi-style scheme on confidential terms.

As part of the settlement process, and without any admission of liability, Lupton Fawcett said: “Lupton Fawcett LLP wishes to express its profound regret that it ever became involved with the Qualia group of companies, and Lupton Fawcett LLP further supports the FCA in its message to professional advisers, namely that particular caution should be exercised in the context of providing advice in connection with collective investment schemes.”

The regulator brought the claim against the lawyers over work undertaken for the Qualia Group of companies by a former member of the firm in and around 2016.

Qualia took £57m from 380 investors in an illegal care home investment scheme centred on the North and North East.

Qualia was based in Leeds and at its peak had 10 care homes and employed nearly 900 staff across the North.

Investors were sold a long-term lease in a room in a care home. The room was then sub-let back to the Qualia companies. Investors were promised annual returns of between 8% to 10% of the purchase price over the period of the sublease. The leases cost between £50,000 and £75,000.

In a previous court case, the High Court agreed with the FCA that the scheme was unlawful and amounted to an Unauthorised Collective Investment Scheme (UCIS). The court also agreed the returns promised to investors were never likely to be achievable.

In the latest High Court claim the FCA alleged that Lupton Fawcett LLP had been knowingly concerned with the promotion of collective investment schemes operated by Qualia.

The FCA said in a statement: “We welcome the constructive approach that Lupton Fawcett has taken since we brought proceedings and are satisfied that the settlement is the best outcome for investors. Professional firms that go beyond their remit by promoting unlawful investment schemes risk causing significant harm.”

Last year Robin Forster, the director of the Ponzi-style unlawful and unauthorised care home investment scheme, was banned for 14 years.

Mr Forster, 42, also deprived creditors of more than £2m through inter-connected business transfers in the days prior to his companies entering administration, according to the Insolvency Service which won a ban against him. He was banned as a company director until 2038.

The FCA had won a High Court case against Mr Forster in 2023.

It also took action against the main sales agent for the scheme, Fortem Global Limited, which was owned by Mr Forster and a Richard Tasker. The Qualia companies are now in administration and Fortem Global is in liquidation too.

The regulator said it would contact affected UK-based Qualia investors in due course to arrange distribution of funds.

Any UK investor in the Qualia scheme who has not received an email from the FCA by 31 January should contact it to make sure the contact details it holds are up to date. Email: This email address is being protected from spambots. You need JavaScript enabled to view it.