The company, which claimed to be selling bullion to investors, acted as a “Ponzi scheme” and defrauded customers, the High Court said

A company claiming to sell gold and silver bars to investors was operating as a “Ponzi scheme” and defrauding its customers, the Supreme Court has heard.

Irish Gold and Silver Bullion Ltd (IGSB), with registered address at The Crescent, Monkstown, South Co Dublin, was wound up last year and chartered accountant Myles Kirby was appointed liquidator.

Based on a thorough investigation into the affairs of the company, Mr Kirby has brought proceedings in the High Court against the company’s director and sole shareholder, Nicholas Wickham, who is alleged to have recklessly tricked clients into investing money in IGSB, which the defendant knew could never be repaid.

Represented by John Kennedy SC, Arthur Cunningham Bl, who was engaged by Michael Quinlan of RDJ Solicitors, Mr Kirby also alleges that Mr Wickham misused client funds to various companies for improper purposes, including making unlawful payments for his own personal gain.

Mr. Wickham was silent on the extent of the company’s financial condition and failed to keep proper records; misrepresented that monies invested in IGSB would be repaid if it was “desperately insolvent”, Mr Kirby added.

It is alleged that the Ponzi scheme had been operated by IGSB for several years and when Mr Kirby was appointed insolvency practitioner there were “no stocks of valuable metal in the company”.

To date, Mr. Kirby says he has identified €1.03 million still owed to the company’s creditors.

On Tuesday, Judge Brian O’Moore granted Mr Kirby’s solicitors an injunction against Mr Wickham and a company he allegedly owns and controls called Hamden Development Homes UK Ltd.

Mr Kirby alleges that Mr Wickham misused funds from IGSB in favor of the second named defendant.

The injunction, issued on an ex parte basis, prevents the defendants, with addresses in London and Watford in the UK, from reducing their assets, including cash held in bank accounts, below a value of just over €1.03 million.

Obtaining the Orders Mr. Kennedy said his client sought the freezing order over concerns that the defendants might seek to destroy those assets and place them out of reach of IGSB creditors.

The solicitor said Mr Kirby’s inquiries revealed the defendants had substantial assets in the form of several properties in Watford with an estimated combined value of up to £2million.

In an affidavit, Mr Kirby said he said IGSB’s dealings were straightforward.

Customers transferred their money to the company to buy gold and silver on their behalf, believing it would be sold at a higher price to make a profit.

Mr Kirby said that in reality payments from clients were often used to make payments to other clients who had previously invested in the IGSB.

Other funds have been diverted to third parties or claims relating to Mr Wickham, which Mr Kirby alleges were used for the defendant’s own benefit.

Mr Kirby said the IGSB failed to keep proper books and records, allowing Mr Wickham to “run the Ponzi scheme” and “conceal his fraud”.

Mr Wickham, he said, did not keep a record of claims from customers who paid money to IGSB but received no gold or silver from it.

This made it appear that the company’s net worth was equal to what customers had paid into the company when there were a significant number of unpaid creditors and a large deficit.

It has not been possible for Mr. Kirby to ascertain the whereabouts of all of the Company’s assets, including cash invested in the Company, or the precious metal holdings held by IGSB because of the carefree nature of Mr. Wickham’s record keeping.

The company is believed to have bought about €3 million worth of gold and silver between May 2019 and June 2001, Mr Kirby said.

In addition, some of the customers have been told that the precious metals are stored in vaults at the world-famous Harrods department store in London and have received certificates from IGSB confirming their purchase.

However, Mr Kirby said Harrods had confirmed to him that it had not done business with the company since 2016 when it closed its accounts and at the time of his appointment had not held any gold in its vaults for the company.

This meant the certificates issued were “a fake” and gold customers believed to have been bought based on their behavior did not exist, Mr Kirby said.

Mr Kirby said that following his appointment as insolvency practitioner, he wrote to Mr Wickham in June 2021 on behalf of an IGSB client who owed over €40,000 and sought certain information about the company from him.

Mr. Wickham never gave Mr. Kirby any information.

Emails from Mr Wickham told the liquidator that “credible threats to my (Wickham) life and family existed”.

Mr Wickham also said all of the company’s documents are in “a safe place in Ireland and that he would engage a lawyer in Dublin”.

No representative of Mr Wickham has ever contacted him and when Mr Kirby’s representatives arrived at the IGSB offices in Monkstown last August, the premises had been vacated and no files or computer equipment were found.

Mr Kirby referred the matter to the Gardai.

Mr Kirby added that the IGSB’s office had also been visited by the Garda Criminal Assets Bureau.

Mr Wickham is also said to have operated a similar business in the UK, which has also been wound up.

Lawsuits have been brought against Mr Wickham by customers of the firm in that jurisdiction, the Court has also heard, including a lawsuit alleging that he supplied someone with a 500 gram gold bar which turned out to be silver bars plated with gold.

A criminal complaint was also filed against Mr Wickham in 2018, alleging that he borrowed a £33,000 bar of gold which his firm had bought for a customer which he wanted to show to other customers which he allegedly failed to return .

He made part payment to the complainant in gold but it is alleged that the complainant still owed an estimated £18,000 worth of gold.

After the freezing order was issued, Mr Justice O’Moore traced the matter back to a date in September.

He also imposed an order barring the media from releasing details of the case until after 12.01am on Wednesday 27 July to give Mr Kirby’s lawyers time to notify financial institutions of the order.

The judge also gave the defendants permission to apply to the courts to change the freezing order after notifying Mr Kirby.

https://www.independent.ie/irish-news/courts/company-that-claimed-to-sell-investors-gold-bullions-operated-as-ponzi-scheme-and-defrauded-customers-high-court-told-41870451.html The company, which claimed to be selling bullion to investors, acted as a “Ponzi scheme” and defrauded customers, the High Court said

Fry Electronics Team

Fry Electronics.com is an automatic aggregator of the all world’s media. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, all materials to their authors. If you are the owner of the content and do not want us to publish your materials, please contact us by email – admin@fry-electronics.com. The content will be deleted within 24 hours.

Related Articles

Back to top button