FOS rules in favour of investors in tax scheme

Simon Garrett

The Financial Ombudsman Service (FOS) has recommended that five investors in a film tax avoidance scheme should be awarded £2.6m following a claim against their advisers 20Twenty Independent Ltd. The scheme involved an investment in Cross Film Partnerships which is a film production company.

Why did FOS rule in favour of the investors?

The FOS ruled in favour of the investors as it stated that the advice given was unsuitable and the potential risks involved in the investment were not fully explained. The claims management company which represented the investors stated that the advisers failed to make the investors aware of the high level of risks inherent in the scheme – including the fact that the loans forming part of the scheme were full recourse to the investor (which typically means that the lender has the right to take any assets of the borrower if it fails to make...

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