Last year I was on the receiving end of an onslaught after I wrote an article about Tullett Brown, a company that had coldcalled me to sell carbon credits, then and now the subject of a Financial Services Authority (FSA) warning. I wrote that Tullett Brown had moved into carbon credits from landbanking, about which the FSA (and many others) had also issued red light alerts.
The piece was hit by a legal barrage which claimed libel, defamation and threatened an immediate injunction. even though every word was true. The article was pulled. It wasn't just me that 'enjoyed' this attention. Two national newspapers dropped planned stories about Tullett Brown on legal advice.
I took to Twitter. And for my pains, I was threatened yet again with personal libel damages which could ruin me. The tweets disappeared.
In the public interest
On 27th June, Tullett Brown, and a number of related companies, were wound up in the High Court on the “grounds of public interest” following a probe by the Company Investigations division of the Insolvency Service (on behalf of the Secretary of State for Business).
The court found that Tullett Brown had taken £3.2 million from investors who received “unsolicited phone calls inviting them to invest in land and carbon credits, comparing this to gold”. Land and carbon scams had netted £1.6 million each.
The judge, Ms Registrar Derrett, said the carbon racket ripped off 128 consumers including one who handed over £138,121.50. Had my warnings not been attacked by lawyers acting for Tullett Brown, at least some of the 128 might still have their money. Instead of searching the internet for Tullett Brown and finding only its own self-serving lies, they might have found alerts.
The judge said: “The evidence demonstrates that misleading selling techniques were used. I am satisfied that customers were misled as to the likely return on their investments and the period over which that return might be realised and led generally to believe they were buying an asset that was appropriate for investment.
“I am satisfied that misleading statements were made in the brochures to induce investment and that there was no real prospect of any returns.”
The investigation showed that land was sold for up to 37.7 times what Tullett Brown had paid.
The carbon credit scam was a carbon copy. The judge said: “The investment was compared to gold but the investor could not access the credits online as promised. It sold the credits at inflated prices. That they were wasting assets was not made clear. And it was difficult for investors to sell credits. They were told that 'the sky is the limit' and that it was 'virtually guaranteed' that the investment would increase in value between 50 and 100% in one year.”
Where did the money go?
Where did the £3.2 million go? A small part went on buying the land and the credits. A larger slice went to the sharp-talking phone crew. And the court was told that £1,584,061 went to associated companies and associated individuals “in substantial and unexplained payments”.
The judge continued: “Tullett Brown's records were inadequate to explain the purpose of the transfers to associated companies.” In winding these up, she said: “There has been a lack of commercial probity in benefiting from the mis-selling carried on by Tullett Brown and a failure to co-operate with the investigation.”
She concluded: “On the uncontested evidence before me it is in my judgement entirely appropriate to wind up the companies on the public interest grounds sought and I do so order.”
Of course, some of the missing investor money went in paying lawyers to prevent the truth being told. Lawyers had threatened to sue me over the term “cold-calling” yet Ms Registrar Derrett uses the expression.
After Tullett Brown and the associated companies were shut in the public interest, Chris Mayhew, Company Investigations Supervisor at the Insolvency Service, said: “I would urge anyone contacted out of the blue by someone they don't know to simply say no to such confidence tricksters and not invest in their hot air. Be green, not gullible.
“We have recently highlighted the increasing number of such companies using dubious and high pressure sales tactics, particularly directed at the elderly who are seen as an easy target. We are determined to stamp out unscrupulous companies that prey on the vulnerable by cold calling and persuading them by misleading statements to invest in unsuitable products.”
Both law firms which threatened me now say they are “unable to comment as they cannot take instructions from the client as it is in liquidation.” I don't think further comment is needed.
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