The latest IT Contractor News from Contract Eye

Accountant Darren Upton, a familiar name in contracting circles, has been made bankrupt by the FSA following the collapse of a collective investment scheme he had been running for contractors.

Upton ran the 'currency plan' scheme via Upton & Co. Accountants Ltd for several years. Funds were collected from clients, to invest in foreign exchange markets, but very limited trading actually took place, and hardly and funds were ever returned to investors.

Following an investigation into the unauthorised scheme run, both Mr Upton and his firm were required to pay just over £1.2m to the FSA, which represented the unrecovered amount of funds he had received from his investors. This is on top of the £3.7m compensation for scheme members already secured in July 2010.

In return for monthly payments of £10,000 over 84 months, the FSA agreed to take no further action to enforce the order for payment on the full amount owed.

According to the FSA website, Upton paid five initial installments, totalling £50,000, but made no further installments after February 2011.

Mr Upton paid five monthly instalments totalling £50,000, which were included in the initial distribution made to investors. He continued to pay the monthly instalments until February 2011, but we have not received any payments from Upton & Co or Mr Upton since then.

As a result of non-payment, Upton was made bankrupt at a hearing in the Leeds County Court on 7th September 2011.

What this means for contractors who invested in the CIS scheme remains unclear, however we will update ITCA with further information soon. You can read more about the bankruptcy proceedings on the FSA website.