Hundreds of victims of collapsed investment scheme, Citygate Housing, should be able to reclaim their lost funds, after National Fraud Helpline won a bank reimbursement claim.
The investment project had promised to build much needed social housing and at the same time offer investors guaranteed high rental returns.
Instead, the firm lost millions of pounds of investors’ money and was officially wound up by liquidators in June, this year. It is currently the subject of a City of London Police investigation.
National Fraud Helpline solicitors last week helped one Citygate victim get a full refund from Halifax under its scam reimbursement obligations, The no win, no fee law firms say this decision should open the door to other investors being able to claim back lost money.
The bank initially rejected the claim in November, last year, but the law firm helped reverse that decision.
Martin Richardson, a senior partner at National Fraud Helpline, said: “This is a very significant settlement as it proves our point that that Citygate Housing victims can recoup their lost money under banks’ fraud reimbursement duties.
‘We know that there are hundreds, if not thousands, of investors who have lost very significant sums. The total losses run to millions of pounds.
“Halifax’s decision to reverse its position and reimburse our client should mean more investors being able to recoup lost funds.”
The client, who was refunded by Halifax, had initially invested £13,500 into the scheme in July, last year, and was promised monthly payments over three years that would total £21,600.
The first three monthly payments of £600 were paid but the investor then received a letter in October saying that the firm was taking on “institutional investment” and would be reimbursing the investment in full at the end of February. No money was ever sent.
National Fraud Helpline have now recovered the lost £11,700 from Halifax. On top of this the bank has agreed to pay interest of £545.70 and a payment of £75 for any inconvenience caused.
Investors in the scheme were promised annual returns of 20% with the minimum investment set at £13,500.
Citygates’ sales brochure read: “This model presents a win-win scenario, providing stable rental income and higher rent yields for clients, while also tackling the urgent housing needs of vulnerable populations.”
Mr Richardson said: “The marketing and offer being made was very enticing which is why so many people invested money.
“We believe that the settlement with Halifax will also help other similar investment claims such as the 79th Group.”
Have you lost money to Citygate Housing? Contact National Fraud Helpline. Call 0333 0033218 or fill out our Claim Form.
