As investors continue to pour millions of pounds each month into Cayman Islands-domiciled Axiom Legal Financing Fund, OffshoreAlert has uncovered more red flags, including conflicting financial statements, £7.9 million loaned to a debt-ridden law firm owned by Axiom’s principal, and insurance provided by a firm that is currently defending a fraud lawsuit brought by one of its clients.

HIGHLIGHTS

•                     First audit shows all loans went to law firms affiliated with Fund principal Tim Schools
•                     One debt-ridden, Schools-owned law firm received £7.9 m
•                     £5.2 m went to law firm whose current owner has a shocking disciplinary record
•                     Insurance provided by firm accused of advance fee fraud

Flowchart shows how Schools profits from a maze of related-party transactions

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The Axiom Legal Financing Fund

By Invest Offshore on December 16,

The Axiom Legal Financing Fund (“Axiom”) provides case finance to a select panel of UK regulated law firms. Axiom only provides loans in respect of cases which can be insured by FSA regulated insurance companies against non-recovery in the event of a law firm bankruptcy. All finance for litigation cases also carries insurance against possible loss at court. Investments can be made directly into Axiom or via most international life assurance companies, UK SIPP providers, investment platforms, QROPS and major private banks.

The Fund provides investors with the opportunity to diversify their portfolio into a fund targeting security of capital and consistent returns that are uncorrelated to any other market. The objective is to provide security of capital and achieve consistent capital growth.

Target minimum net annual growth rates:

• 11% (Sterling)
• 10% (US Dollar)
• 10% (Euro)

No entry or exit charge to investors. No management charge to the fund, performance fee only (the Investment Manager’s fees and marketing costs are paid by the law firms) Monthly dealing. The Axiom Legal Financing Fund is a Segregated Portfolio based in the Cayman Islands. It is a “professional and experienced investor” fund and can only be purchased through a regulated financial intermediary.

Due Diligence

The Axiom Legal Financing Fund is one of 435 Funds administered in the Cayman Islands. The administrator, JP Fund Administration won as “Best Fund Administrator for 2011” by Hedgeweek and was recently voted “runner-up” by the publication “Hedge Funds Review”.

The auditor of Axiom is BDO. The custodian Bank of record is Deutsche Bank (Cayman) Limited, Grand Cayman.

CIMA – The Cayman Islands Monetary Authority (CIMA), amongst its other duties , is responsible for the regulation and supervision of the Cayman financial services industry. Within their brief they have oversight of the monitoring of compliance with money laundering regulations, issuance of a regulatory handbook and issuance of rules and statements of principle and guidance.

Fund administration in the Cayman Islands is an activity governed under the Mutual Funds Law (2009 Revision) and other relevant laws.

JP Fund Administration is the holder of an Unrestricted Mutual Fund Administrators Licence, number 15991. This can be ascertained by going to the Cayman Islands Monetary Authority website and typing jp fund administration in the search box.

Professional bodies / memberships

The company is also a member of the Alternative Investment Management Association (AIMA), the Cayman Islands Fund Administrators Association (CIFAA) and the Cayman Islands Compliance Association (CICA).

See iNews Cayman story, “Head of Cayman fund group Tim Schools accused of professional misconduct in UK” we published Aug 22, 2012 at http://www.ieyenews.com/2012/08/head-of-cayman-fund-group-tim-schools-accused-of-professional-misconduct-in-uk/