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Fraud Defence

PCB is renowned for its expertise in defending clients faced with allegations of deceit, conspiracy, breach of fiduciary duty and other allegations of dishonesty, unjust conduct and unconscionability.

We have also acted for numerous defendants faced with allegations of fraud, and who are often also faced with freezing orders and other interim relief and committal proceedings. Those defendants may have been put “on the back foot” early in the process, and often feel that the court is against them in making various, sometimes draconian, orders. We look at how to put the client “on the front foot”.

If you are faced with claims where serious wrongdoing is being alleged, then we have the skills to help you, backed up by decades of experience in winning such cases around the world.

OUR EXPERTS

PCB has been ranked consistently by the main legal directories in the top tier of firms in England in civil fraud, being described as “the pre-eminent boutique” in London’s civil fraud arena.

Anthony Riem and Trevor Mascarenhas are identified as Leading Individuals by The Legal 500 and are in the top tier for civil fraud practitioners in Chambers & Partners. Jon Felce is identified as one of only two Next Generation Partners by The Legal 500, which also praises Nick Ractliff and identifies Natalie Todd as a key individual. Our strength in depth is recognised by Chambers & Partners, which says that “Associates there have to punch above their weight in terms of the work they do, and they are all solid and reliable as a result.” Associates Rachel Turner and Camilla Cook are singled out by The Legal 500.

OUR TRACK RECORD

Examples of our success on behalf of defendants include:

  • Defending a US$1bn conspiracy claim where, following a week of cross-examination of our client at trial, the claimants discontinued the claim against him.
  • Obtaining the discontinuance of a €1bn claim alleging fraud on creditors, and the recovery by our clients of the costs of defending those proceedings following an innovative application to obtain security for those costs against third party funders of the litigation.
  • Bringing an early end to a US$100m+ fraud claim, by demonstrating that the claimant had no prospect of overcoming our client’s limitation defence.
  • Obtaining the discharge of a £100m freezing order on the basis that the claimants had provided untruthful evidence to the Court when obtaining the freezing order, and obtaining a 6 figure judgment for damages caused to our client by the freezing order.
  • The striking out of a US$70m claim within 6 months of taking over the case, before which one Commercial Court Judge had said there was no defence to liability.
  • One of the leading judgments on the limits of the English Court’s ability to grant freezing order relief in support of foreign proceedings: in that case obtaining discharge of freezing orders against family members of the primary defendant.
  • Persuading the Privy Council that the BVI Court could not hear a dispute over ownership of a company which was to be the vehicle used to pursue fraud claims against our client.
  • Successfully defending a committal application brought against a defendant alleged to have been in breach of obligations to disclose assets.
  • Obtaining substantial orders for security in respect of possible damage caused by freezing orders, as well as for costs.
  • Reaching settlements or obtaining vindicating judgments in numerous cases by building the evidential picture for the client and exploiting weakness in the opponent.

Selected Case Summaries

Having successfully defended all claims made against our client in conspiracy and for breach of fiduciary duty, the appellant obtained permission to appeal in respect of one of seven grounds. We obtained security for costs in respect of costs of that appeal, which was heard over 2 days in December 2019. The appeal was dismissed in February 2020 when the Court of Appeal found that a disclosed principal could not be excluded from suing on a shareholders agreement. We recovered costs in the amount of the security paid by the appellant so the client did not have seek to have the costs of the appeal assessed. The appellant has sought permission to appeal to the Supreme Court, having had such permission refused by the Court of Appeal.
This was an oligarch joint venture fight over the ownership of land in central Moscow worth US$200 million. The client was alleged to have breached his fiduciary duties owed to the Claimant and conspired with his Co-Defendant to unlawfully deprive the Claimant of her 50% interest in the joint venture. The case attracted legal interest after the Court decided that whilst the client was entitled to security for costs, that amount should be calculated by reference to the extent of the risk that the orders were not enforceable in Russia, where the Claimant was domiciled, rather than the entirety of his costs. We successfully appealed that order in the Court of Appeal, where the Court held that our client was entitled to security for all his costs. That was an important steps to take as after a 6 week trial which finished in mid-January 2019, the Court not only rejected all the claims made against the client but also awarded him indemnity costs as the Court found that the Claimant had given dishonest evidence to the Court pursuant to an agreement with another party to the proceedings. We successfully opposed the Defendant’s application for permission to appeal to the Court of Appeal on all but one of the seven grounds; the trial judge gave permission to appeal on the one remaining ground.
PCB acted for Mr Walid Giahmi in successfully challenging the jurisdiction of the English court. The case was one of a series of claims and threatened future claims against Mr Giahmi and a number of major Western banks, alleging that investments were made by the Libyan Investment Authority (“the LIA”) with those banks due to Mr Giahmi paying bribes to LIA employees. PCB persuaded the Court that the LIA had seriously breached its duty of full and frank disclosure when it obtained permission to serve him out of the jurisdiction, in particular because it had failed to draw the Court’s attention to the relevant test for limitation and the related evidence tending to show that the LIA could not satisfy that test. Indeed, the Court was persuaded that the LIA had no reasonable prospect of satisfying the test and the claims were therefore time-barred.
PCB’s defence on behalf of 33 respondents to a €1bn claim culminated in PCB’s clients being awarded indemnity costs. The Claimants’ case had collapsed after 4 days of a 6 week trial, but the Judge considered he was in a position to assess in broad terms the reasonableness of the pursuit and the manner of presentation of the proceedings, to determine in all the circumstances already apparent to the Court whether the case was such as fairly and properly to be characterised as “out of the norm”. He concluded that this had been high-risk litigation, aggressively and very expensively pursued and that it was taken out of the norm by factors including (1) the pursuit of serious allegations of commercial impropriety which were suddenly abandoned without explanation; (2) the changing nature and inconsistencies in the case; and (3) the publicity attending the case.  

PCB acted for the defendant in this long running mutli-million dollar dispute arising out of two actions. The Court had to determine whether liabilities owed to Mr Al Refai from the first action should be set off against liabilities for costs he owed to the bank in the second action or against a liability to pay a Bahraini judgment debt to the bank. The bank sought the former, whilst Mr Al Refai sought the latter. It was common ground that this was a matter for the Court’s discretion, and that discretion was ultimately exercised in favour of Mr Al Refai given that it was important to him to have the Bahraini judgment debt discharged, as that debt could be used to have him imprisoned in Kuwait.

PCB acted for a respondent to a claim brought by liquidators of a Greek telecommunications company, who alleged that the respondent (one of the world’s largest private equity funds) had sought to put approximately €1bn of assets beyond the reach of creditors and had traded fraudulently. The claims were brought pursuant to sections 213 and 423 of the Insolvency Act 1986. At the same time parallel proceedings were being pursued in New York against related parties. The liquidators sought a stay of the English proceedings until after the final outcome of the New York proceedings. PCB successfully opposed the stay application.

PCB acted for defendants to a claim brought by a company that owned a golf club in respect of the sale by one of PCB’s clients as mortgagee in possession of the land. It was alleged that the sale had taken place at an undervalue, it being claimed the land was worth nearly £20m more than the sale price. The claimant sought to amend to add claims in conspiracy. PCB successfully resisted the amendment on the grounds that it was too late as it would result in the adjournment of the trial.

PCB acted for the primary defendant to a US$1bn claim. The claimants obtained permission to serve him out of the jurisdiction, a worldwide freezing order in the sum of £100m and other injunctive relief to stop him publishing allegations against claimants of serious wrongdoing, including the breach of various banking regulations. In obtaining such relief, the claimants had relied upon a very large volume of emails that had been hacked from the defendant’s email account and accounts of friends and family. The claimants however claimed not to have been involved in the hacking, saying that the material had been provided to them anonymously in the post. Following cross-examination of the claimants’ witnesses, the court concluded that they had given dishonest evidence about the hacked material and also breached undertakings regarding the preservation of related evidence. As a consequence the permission to serve PCB’s client out of the jurisdiction was set aside and the freezing order and other injunctive relief was discharged. An inquiry was ordered in respect of damage caused by the freezing order.

PCB acted for the parents of the main defendant, who were resident in Italy. The English court had already granted a freezing order under s25 of the Civil Jurisdiction and Judgments Act 1982 in support of substantive proceedings taking place against the main defendant for investment fraud. The claimants then sought to extend that freezing order against the parents on the basis that they had assisted in the concealment of substantial assets. PCB however applied successfully to set aside the freezing order against the parents on the basis that as they were neither resident in England nor had any assets in England, it was not appropriate for such an order to be made.

PCB acted for a former senior employee of a state-owned aluminium company. This was one of a series of claims that the company made against former senior officers and employees alleging corruption. All of the other claims led to large judgments or settlements. PCB’s client was faced with a multi-million dollar claim for accepting alleged secret commissions and other alleged breaches of fiduciary duty. Following trial, the court held that PCB’s client had acted honestly and had not breached his duties. He received payments to which he was entitled and with the company’s knowledge. The claims against him were therefore dismissed.

PCB acted for the respondent to a worldwide freezing order and a search order. The claimant had in its investigations obtained evidence through the use of pre-text calls to a Swiss bank. PCB led evidence that such conduct was under Swiss law prima facie criminal. As a consequence, PCB submitted, and the court accepted, that there could be no legal privilege in the reports of the investigators. Those reports were therefore ordered to be disclosed. PCB also submitted that the claimant’s conduct should lead to the discharge of the orders they had obtained, which led to agreement being reached in relation to more limited relief going forward.

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