Tony Hetherington is a crack researcher for the Financial Mail on Sunday who fights readers by uncovering the truth behind closed doors and winning victories for those left without funds. Find out how to contact him below.
Miss MH writes: I bought a piece of art from Smith & Partner Limited in August last year and later bought two more pieces.
I was naive and thought it was a good investment because of the strong selling proposition. Since then, I’ve been lied to all the time. He never sends emails, only calls claiming he has “great news”.
Over time, I realized how much rubbish I was fed. I asked to resell the painting, but they always slip me.
‘Naive’: Reader bought Lion & The Witch from Smith & Partner headed by Luke Sparks (sidebar)
Tony Hetherington says: You contacted me following my December 11 report that an elderly investor invested £17,000 in limited edition prints sold by Smith & Partner after being told that his first purchase had skyrocketed in value and showed a profit of £3,000 within a few weeks. I asked art company owner Luke Sparks about the details of this amazing piece of art. He didn’t answer, but I’m happy to add that he just paid the elderly investor back in full.
One of the attractions of the scheme is that Sparks touts that his investors can make “potential returns of up to 64.6% in just 12 months.” I questioned that, and Sparks told me that there was one such profit made, back in 2017, when the business was just getting started and before it took over. If there has been a re-run or a big profit since then, I expect he would be interested in highlighting it.
I also asked Sparks about the financial situation of his company. The latest reports from the Companies House show that the company is in serious trouble with the IRS. I asked Sparks about this twice before last month’s report, but he didn’t answer.
He now says the dispute has been settled, though the numbers are unclear. Similarly, records show that Sparks himself borrowed £459,038 from the business. I asked if he has since refunded it, but Sparks didn’t answer.
When I pressed for your own investment, Sparks told me, “Please note that I have shared supporting evidence with you to the extent that we are allowed to.” He added that he would be happy to share additional evidence “if he is given permission to do so.”
Well, last Monday, I gave Sparks your legally binding, signed authorization, allowing him to discuss your complaint with complete freedom and pass on any documents or other record of Smith & Partner’s dealings with you, including its promotional offer. And last Tuesday he refused.
There are many question marks hanging above this diagram. Smith & Partner touts its “extensive experience in the arts investment market” but does not say who exactly has this extensive experience or where they got it.
The prints, which are produced by a separate company controlled by Sparks, are sold by his telephone sales force based near the Shard building in London, but the investors are bound by written terms. Are they credited to them in sales calls? How can they be bound by conditions they have not seen? I asked, but Sparks didn’t explain.
Despite all this, I can note two striking points. Sparks admitted that his company’s advertising contained incorrect advice about taxes due on any profits made by investors. He fixes it. And other good news? You bought £7,651 worth of prints that Smith & Partner says are held in a warehouse in Switzerland. By the time you read this, you will have received a full refund.
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Fraudster Michael Nascimento
Fraudster Michael Nascimento, who was exposed by The Mail on a Sunday back in 2011, has been ordered to spend almost four additional years in prison for failing to pay compensation to the victims of his £2.8 million investment scam.
The extra time is in addition to the existing 11-year sentence handed down in 2018.
Nascimento and his gang set up a fake investment company, Morgan Forbes (UK) Limited, and used high-pressure phone calls to convince investors to buy shares in a Madeira resort development scheme. They were promised a guaranteed return of 125 to 228 percent.
But the Financial Conduct Authority found that the money raised was used to pay the costs of the scam and fund Nascimento’s lifestyle.
In 2021 he was ordered to pay £976,511 but handed over less than half of that.
The scam started in 2010, and in 2011 I warned that Nascimento’s company was breaking the law by simply selling shares without approval from the financial regulator.
No action was taken, and I repeated the warning in 2012 when Nascimento made a deal to let an offshore trading firm take over the marketing of its worthless shares.
The scam continued until 2014, and in 2018 the FCA allegations went to court.
Last April, the FCA delivered their final bow to Nascimento. 12 years after he started running his illegal investment firm, the FCA banned him from working in the financial services industry.
This will teach him.
If you believe you have been the victim of financial irregularities, please write to Tony Hetherington at the Financial Mail, 2 Derry Street, London W8 5TS, or email [email protected] Due to the high volume of inquiries, personal responses cannot be given. Please send only copies of original documents, which, unfortunately, cannot be returned.
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