At FSA's application High Court orders winding‐up of UK partnership which facilitated offshore boiler room share sales to UK investors
| DOI | https://doi.org/10.1108/13581980710762336 |
| Pages | 343-347 |
| Published date | 31 July 2007 |
| Date | 31 July 2007 |
| Author | Joanna Gray |
| Subject Matter | Accounting & finance |
LEGAL COMMENTARY
At FSA’s application High Court
orders winding-up of UK
partnership which facilitated
offshore boiler room share sales
to UK investors
Joanna Gray
University of Newcastle upon Tyne, Newcastle upon Tyne, UK
Abstract
Purpose – This study aims to report and comment on the High Court judgment regarding The
Inertia Partnership (TIP).
Design/methodology/approach – The paper outlines the facts surrounding this decision and
comments on the ruling.
Findings – The court took a strong line on the link between the activities of TIP and offshore boiler
rooms and the value to the achievement of FSA’s statutory objectives that the firm message a
compulsory winding-up order on public interest grounds would send to other firms and individuals
who may become involved directly or indirectly with such potentially abusive sales techniques.
Originality/value – The paper provides useful information for all those involved in management
consultancy businesses.
Keywords Legal decisions , Management consultancy
Paper type Viewpoint
Re Inertia Partnership LLP (High Court: Chancery Division: Jonathan Crow QC sitting
as Deputy Judge)
Date of judgment: 23 February 2007
Facts
The Inertia Partnership (TIP) a UK management consultancy business had had only
one member since 2005, Mr Shears. It was neither authorised to carry out regulated
activities in the UK nor exempt from the general prohibition on so doing under FSMA
2000. Mr Shears was acquainted with a Mr Jacob Daniels who operated through a
Seychelles-based company, Porterland Associates Ltd (Porterland). Mr Shears
understood Porterland to have a client base of high net worth individuals who were
interested in investing in UK public companies. He therefore, effected introductions
between three UK public companies (Vivadi plc, Plasma Warehouse Group plc and
Police 5 Group plc) and Porterland in order to assist those companies raise capital.
Porterland engaged various associates on its behalf to contact investors in relation to
placings of these companies’ shares but these associates were actually boiler room
operations which cold called UK clients to solicit their participation in the placings.
The current issue and full text archive of this journal is available at
www.emeraldinsight.com/1358-1988.htm
Legal
commentary
343
Journal of Financial Regulation and
Compliance
Vol. 15 No. 3, 2007
pp. 343-347
qEmerald Group Publishing Limited
1358-1988
DOI 10.1108/13581980710762336
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