Midas Financial Solutions Collapse

Jim Shannon Excerpts

Tuesday 22nd March 2022 Westminster Hall

[Jim Shannon (Strangford) (DUP)]

Thank you, Mr Stringer, for allowing me to speak on this issue. I congratulate the right hon. Member for Orkney and Shetland (Mr Carmichael) on bringing it forward. As always, he set the scene very well for his constituents, who have lost out, and he was passionate in asking for answers to the questions he put forward. It is pleasing to see the Minister in his place. He always comes with a positive attitude to these issues. He understands them well and we look forward to his response. Hopefully, he can address some of the issues we have.

It is also a pleasure to see the shadow Minister, the hon. Member for Hampstead and Kilburn (Tulip Siddiq), in her place. Like others, I want to put on record my thanks to her for her hard work and endeavours to bring home her constituent, Nazanin Zaghari-Ratcliffe, and others. That campaign has been marvellous. We all admire the hon. Lady very much, and we see her perseverance. If she is adding her weight to this debate, I am sure that will be enough to push it over the line— no pressure on the Minister. Again, I thank her so much.

The case of Midas Financial Solutions is disturbing to the extreme. My heart goes out to all those hard-working people who trusted a financial adviser and have lost their money. That was very well illustrated by the right hon. Member for Orkney and Shetland. From a 22-year-old to two people who have died, there appear to be almost 200 victims. Some of them lost a few thousand, but that was all they had. Those people invested thinking that it would make their money last for their old age. Unfortunately, it did not. Others lost almost £500,000. I have a number of questions for the Minister, but one is whether the families of those who died get compensation?

The sheer scale of the Ponzi scheme is mind-boggling, yet the shortcomings and the evidential base are well documented. People are out of pocket. In debates on other issues, the Minister has tried hard to respond, but we need to ensure that the investors who are most out of pocket—I think 95 is the final figure—can be reimbursed. What can be done to ensure that lessons are learned from what we are bringing to the attention of the Minister and the Government?

When I read the background to the case, one thing became glaringly obvious: the FCA managed to wash its hands of the entire scheme until a judge in the civil case underlined the fact that this was truly an investment scheme and therefore should be accepted into the Financial Services Compensation Scheme. Why did it take a civil case to bring this within the FCA scheme remit? What steps do we need to take to ensure that this does not happen to anyone else and that people can access the scheme, which is designed to help, without having to fund a civil case? It is not always possible for ordinary folk who have already lost the bulk or all of their moneys to pursue a legal case. They must feel frustration; they look to the Government and the system to protect them and to ensure that their investments are okay, ever mindful that there are some in this world who would take advantage of people trying to build something for their future.

My next point runs on from that. It is grossly unfair that those 95 people must pay from their limited recoup to cover legal fees of £1.5 million—or perhaps £2 million, as the right hon. Gentleman said.

[Mr Carmichael]

I can actually give the hon. Gentleman the figure now: it is £1,903,619.92.

[Jim Shannon]

There we have it. The hon. Member for Hampstead and Kilburn and I now know that the figure is £1.9-odd million in legal fees. They will pay that out of the same amount as those who did not pay into the court case will receive. We can understand the frustration of those who paid for these things to be chased up, given that others have the advantage of not having paid. There is an anomaly. Some lost out, but the legal fees then follow. Surely, the public purse should have paid, rather than people who have already lost every penny of their savings.

The head of a regulated company unscrupulously and fraudulently stole millions of pounds to furnish his lavish lifestyle. His own wife has been instrumental in helping the victims, and that is one of the good things that has come out of this, but her husband stole from his customers. Why has the body set up specifically to look into these things been so behind the door in fulfilling its role? How can we ensure that this loophole is removed so that people have full help and assistance in future? There are lessons to be learned that we can use for the future. We need to ensure that people who invest in these pension schemes do not find themselves out of pocket when the time comes.

The background article I read in The Courier highlighted the fact that the warning signals regarding this man were ignored or overlooked by the FCA. If they had not been, that may have prevented more people from being duped. What is being done to prevent these things from ever being overlooked again? People want the assurance and the confidence when they invest that the company they are dealing with is safe and secure. What has been learned by the Government and the Minister? What legal measures will be put in place to ensure this does not happen again?

I conclude by thanking the right hon. Member for Orkney and Shetland for bringing the debate forward. It is important that these issues are debated in Westminster Hall or the main Chamber. The right hon. Gentleman has been involved in these issues on behalf of others in the past, and we have spoken in many debates together. Our job is always to illustrate examples where, unfortunately, things have gone wrong, but I respectfully say to the Minister that his job and that of the Government is to ensure that these things do not happen again.

Through the debate, we are seeking not only to get justice for the right hon. Gentleman’s constituents and hundreds of others who have lost out, but to ensure the Government close the gaps in support for victims and in the regulation of the system. What has been done legislatively to ensure this does not happen again? This failing has ruined the lives of hundreds of people, when it could have been prevented. It is turning some people’s comfortable retirement into purgatory, and we must address that now.