CONNAUGHT FUND

That this House welcomes the findings of the Complaints Commissioner following complaints lodged by George Patellis and Adam Nettleship regarding the loss of over £100 million by investors in the Connaught Income Series 1 Fund; notes that Mr Patellis was Chief Executive of Tiuta PLC, a firm at the heart of the scandal, and his efforts to whistle-blow on mismanagement of the fund were met by a response from the Financial Services Authority (FSA) that the Complaints Commissioner described as uncoordinated and fragmented, and failed to prevent continuing detriment to investors; regrets the refusal of the Financial Conduct Authority (FCA) to accept the Commissioner's recommendation that Mr Patellis receive a public apology for the lack of care over his treatment as a whistle-blower and the defensive and insensitive manner in which it has defended the FSA's failure to refer Mr Patellis' evidence to the police or to advise him appropriately on his ability to do so; further notes that Mr Nettleship is an Independent Financial Adviser (IFA) and that the Commissioner found the FCA's emphasis on investors looking to IFAs for compensation may have had the effect of shifting the focus away from the possibility that there might also have been regulatory failure; considers that the Commissioner's findings raise serious questions of regulatory failure; expresses concern over whether companies involved in the Connaught Fund demonstrate an appropriate commitment to high ethical standards; and calls on Capita as original operator of the fund, and its successor Blue Gate, to acknowledge their responsibilities and offer investors realistic compensation.