A joint investigation by the SFO and Nottinghamshire police led to two former partners of Arck LLP, Kathryn Joy Clark from Nottingham and Richard Aston Clay from Leicestershire, being charged in November 2013 with fraud and forgery offences. Kathryn Clark and Richard Clay pleaded guilty to fraud and forgery offences in 2014. Arck LLP created and marketed financial products including property development in Cape Verde. The scam defrauded investors of their money, in some cases their pension monies and life savings. It is estimated that approximately £50m was invested in these products by individual investors and, in some cases, Independent Financial Advisers themselves.
Outcome of criminal case
Richard Clay pleaded guilty to three counts of fraud in December 2014, while Kathryn Clark pleaded guilty in July and October 2014 to three counts of fraud and two counts of forgery.
Richard Aston Clay, 50 of Nottinghamshire was sentenced to 10 years and 10 months in prison, while his business partner Kathryn Joy Clark, 52, of Derbyshire was sentenced to two years in prison, suspended for 2 years, with 300 hours unpaid work. Clay was also given a serious crime prevention order, to last for five years. Clay and Clark were disqualified from being a director of a company by the Insolvency Service for 15 and 14 years respectively earlier this year.
On 17 June 2016, Richard Clay was ordered to pay £344,244.07, £275,000 to be paid within 21 days and the remaining balance within three months. If he failed to do so, the Judge ordered that he must serve a default prison sentence of three years.
His confiscation order was paid in full with the final payment being received on 20 November 2017.
Compensation from Clay’s confiscation order has been distributed to those victims eligible
Kathryn Clark was ordered to pay £178,522 in confiscation, all of which is payable to victims. The Judge ordered that Clark must pay £30,000 within 21 days and the remaining balance within 3 months or serve a default sentence of 18 months in prison. This confiscation order was fully satisfied on the 28 September 2016.
She was also handed a stand-alone compensation order of £40,000, which must be paid within nine months or a default prison sentence of six months will be imposed. £20,155.74 has been paid to date.
Clark made an application to reduce this order but was refused on 22 October 2018 and has been ordered to pay the remaining balance at a rate of £1,000 per month.
Clark is currently seeking Judicial Review of this decision.
Page published on 10 Apr 2015 | Page modified on 6 Feb 2019