Consumers gave money to Xcore in return for a 6% annual return. They were led to believe that Xcore would be trading their money on forex and equity markets. However, the majority of this money was instead used to fund an office in Mayfair, brokers’ wages and Mr Chitty’s lifestyle. Mr Chitty’s personal spending included £102,000 on cryptocurrencies, £58,000 on luxury goods, £24,000 on a Rolex watch and £20,000 towards his wedding.
The Order declares that Xcore ran a deposit taking scheme without the necessary authorisation by the FCA, and that Jonathan Chitty was knowingly concerned in the scheme. It further requires Xcore and Mr Chitty to pay the FCA £917,231 which is the full value of all outstanding sums owed to consumers. The FCA will distribute to consumers any funds it is able to recover from Xcore and Mr Chitty.
Mark Steward, Executive Director of Enforcement and Market Oversight at the FCA, said:
'Prompt action by the FCA stopped this scheme in its tracks and prevented victims incurring much greater losses.
'Consumers should be especially wary when contacted out of the blue about an investment opportunity, and about financial services firms offering investment opportunities without FCA authorisation. If they’re not authorised, it’s probably a scam.'
On 20 November 2018, following an application by the FCA, a Judge in the High Court had previously imposed a freezing order on Xcore and Jonathan Chitty’s assets, and ordered to stop selling investments regulated by the FCA. This order remains in place until further order of the Court.
Notes to editors
- A freezing order and injunction was obtained against Xcore and Mr Chitty on 20 November 2018.
- The Order of the High Court (by consent) was made on 14 May 2019. The Order declares that Xcore has breached Section 19 of the Financial Services and Markets Act 2000 and that Mr Chitty is knowingly concerned in these breaches. The Order also provides for the FCA’s costs to be met by Xcore and Mr Chitty.
- The FCA has an overarching strategic objective of ensuring the relevant markets function well. To support this it has 3 operational objectives: to secure an appropriate degree of protection for consumers; to protect and enhance the integrity of the UK financial system; and to promote effective competition in the interests of consumers.
- Find out more information about the FCA.
Subscribe to The Financial Analyst to get original opinion and all the latest news on trending financial topics and breaking stories related to analysis and global markets. If you have a tip or a financial opinion to share get in touch to submit your story.