SFO secures £900,000 confiscation order against Axiom Fund financial adviser

A former financial adviser convicted of fraudulent trading in relation to a legal finance fund must pay more than £900,000 as part of a confiscation order.

His Honour Judge Perrins, sitting at Southwark Crown Court, granted the £928,479.89 confiscation order against David Kennedy. The money received will be returned to victims of his fraud.

Kennedy is currently serving an eight-year prison sentence for a fraud he ran with his business partner, former solicitor Timothy Schools. Kennedy was convicted and sentenced last year for his part in managing the Cayman Island registered Axiom Legal Finance Fund for over two years. The no-win, no-fee scheme used investors' money to fund thousands of high-risk cases that were not independently vetted and often failed at court.

The Axiom Fund lost more than £100 million of investors’ money. Kennedy was found to have diverted more than £5.8m from Axiom Legal Finance Fund to pay for items for his own benefit including a villa in Tenerife, properties in Hull, savings in a Spanish bank account a pension fund and ‘several’ luxury vehicles.

Kennedy has three months to pay the sum set out in the confiscation order. If he fails to pay he could risk adding up to six and a half years to his sentence.

The confiscation order follows the Serious Fraud Office’s first successful application for an unexplained wealth order to recover a property owned by Schools’ ex-wife. The order was granted at the High Court earlier this year. The SFO secured £1.1m from the sale of a Lake District house in September.

Paul Napper, the SFO’s head of the proceeds of crime, said: ‘David Kennedy funded a lavish lifestyle with other people’s life savings and many lost everything when his scheme collapsed. This order is a significant step forward in addressing the impact of Kennedy’s crime on victims.’