The High Court has sentenced a man involved in four Unauthorised Collective Investment Schemes (UCIS) which lost investors £15m to six months in prison after he diverted assets which could have been used to repay investors.

The High Court of Justice sentenced Robert John McKendrick to half a year in prison for contempt of court after the FCA brought a case against him.

The FCA said that Mr McKendrick had diverted funds and failed to disclose information about his assets in breach of freezing injunctions obtained by the regulator.

Mr Kendrick was involved in four UCIS schemes promoted mainly by Capital Alternatives:

• African Land (also known as Agri Capital) offered investments in rice farm harvests in Sierra Leone; and
• Reforestation Projects (also known as Capital Carbon Credits) offered three investments in carbon credits intended to be generated from land in Sierra Leone, Brazil and Australia.

Mr McKendrick was the main director and sole shareholder of African Land which was unlawfully promoted and operated without authorisation from the FCA.

The court found that Mr McKendrick made misleading statements to investors and was knowingly concerned in misleading statements made by others.

Losses across the schemes exceeded £15m.

In March last year , the Court ordered Mr McKendrick to pay back losses to the FCA so they can be paid back to investors. Mr McKendrick has since been declared bankrupt.

Mr Kendrick later breached orders requiring him to disclose all his assets and preventing him from disposing of them.

He appointed his wife to manage his portfolio of buy-to-let properties and diverted the rental income from these properties to his wife. He did not disclose these arrangements.

As a result, the FCA brought an application to court with the primary aim of discovering what had happened to the money so it could recover it for investors. Mr McKendrick admitted his breaches of the freezing orders and co-operated with authorities, a move which saved him from a longer sentence of 12 months.

The FCA says it will ensure that as much of it as possible is recovered for investors.

Mark Steward, executive director of enforcement and market oversight at the FCA, said: “In this case, Mr McKendrick misled investors and then, in contempt of court, failed to comply with court orders requiring him to properly account for the losses. The FCA will ensure that defendants who mislead investors are held to account to the fullest extent possible.”

• Investors who have not yet contacted the FCA about these schemes should email This email address is being protected from spambots. You need JavaScript enabled to view it. or write to the FCA at: Freepost RTZE–RHAL–URAJ, marked for the attention of UBD JD/CG RE00718, Financial Conduct Authority, 12 Endeavour Square, London E20 1JN.