Skip links

Innocent Wife ‘Aided’ Husband’s Unlawful Investment Scheme

In a case of love conquering all – including good sense – a wife who was ‘swept off her feet’ by her lying husband and bore two of his children whilst he fleeced friends and relatives of three quarters of a million pounds will have to carry the can for his dishonesty, following a Court of Appeal ruling.

The wife was ‘deeply happy’ with her husband of seven years who had ‘appeared rich, successful and extravagant’ when they met at Royal Ascot. However, her life was shattered abruptly when he was revealed as ‘a liar and a fraudster’ who had squandered a £700,000 investment pot entrusted to him by their nearest and dearest on a disastrous online football betting scheme.

She had no idea that her husband’s ‘no risk’ strategy disguised a Ponzi scheme – but was held liable to cover his crushing losses after the Court ruled that she had ‘aided’ him in his criminal wrongdoing by letting him use bank and online betting exchange accounts which had been opened in her name.

The husband, a former mortgage broker, had promised ‘dividends’ in excess of 15 per cent per annum to ‘investors’ in his scheme. Those who lost substantial sums included their friends, neighbours and the wife’s father and grandfather. The wife was sued by a divorcee who was taken in by the husband’s charm and lost £300,000.

The Court observed, “On any basis this is an unfortunate case…the wife seems to have been a naïve young woman who was swept away by a dishonest man many years her senior – she met him, married him and bore him two children in a matter of less than three years.”

The wife was ‘acquitted of all bad faith’ by a county court judge who said that she was ‘palpably honest’ and ‘a complete innocent’ when it came to both betting and football.  She had been as convinced as anyone else that her husband had a fool-proof strategy for winning on match results.

However, the wife was ruled liable on the basis that she had permitted her husband, a former mortgage broker, to use her accounts in the knowledge that he was at the time bankrupt and that he had been banned from carrying on investment activities by the Financial Services Authority.

Dismissing the wife’s appeal, the Court noted that she had freely admitted that she knew about her husband’s scheme – although she had believed like everyone else that it was fool-proof – and had sometimes paid out dividends to investors at her husband’s request.

Although the wife had ‘suffered grievously’ at the husband’s hands, the conclusion that she had aided him in the illicit investment scheme was ‘inescapable’. The Court concluded, “By providing the account facilities to the husband and permitting their use for payments in implementation of the scheme, the wife was aiding the commission by the husband of a criminal offence under Sections 19 and 23 of the Financial Services and Markets Act 2000.”