Investment fund with businesses in BVI and Hong Kong investigated by HK regulators

Hong Kong regulators have done the raid on Buttonwood Legal Capital, which is the adviser of an investment fund Centaur Litigation, and has registered businesses in the British Virgin Islands and Hong Kong. The Securities and Futures Commission served search warrants and removed documents and records from Buttonwood’s former Hong Kong office and the office of Hong Kong Trust Company, the fund administrator for Centaur Litigation. The regulators also visited Allied Pickfords, Buttonwood’s removals firm.

The raid raised concerns over the reported HK$1.2 billion, as many of supposed business partners of the fund denied any links with it – among these partners, Baker Tilly Hong Kong, named as the fund’s auditor in a memorandum to investors dated August 2012, global insurance group Aon Insurance Managers named as an insurance partner, London-based law firm Bristows, named as a legal adviser to the fund’s investment manager, Argentum Investment Management, and some others.

The regulators’ raid took place in the mid of March, one month after David Marchant, an investigative journalist and editor of the Offshore Alert website, published an article which raised questions about the fund’s operation, and if Buttonwood and Centaur could guarantee returns. Some weeks after the publication, Buttonwood moved its operations to Australia, and the sole director of the firm’s BVI operation, Brendan Terrill, was joined in this jurisdiction by two new directors, Simon Franklin and Stuart Hackett, of Sydney-based corporate advisory firm Dequity Partners. He remained the sole director only of Buttonwood Hong Kong. An internal audit of accounts was due to finish on March 14, but the results have not been published.

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