Fraudulent Trusts & Dishonest Trustees
We have considerable experience in handling private wealth disputes in both England and Wales and internationally.
- Claims against fraudulent trustees for breach of trust and breach of fiduciary duty;
- Claims against complicit third parties for dishonest assistance and/or knowing receipt;
- Advising on and seeking declaratory relief concerning the existence of constructive trusts;
- Claims arising from sham trusts;
- Progressing asset tracing investigations and pursuing trustees and potentially complicit third parties for recovery of misappropriated trust assets, particularly where the insolvency of a trust corporation or the bankruptcy of a trustee or third party has occurred; and
- Applying for freezing injunctions where there is an urgent risk of the fraudulent disposition of trust assets.
Experience
We acted for Virtue Trustees (Switzerland) AG, a market-leading Swiss fiduciary practice, in the case of Invest Bank PSC v El-Husseini and Others [2024] EWHC 2976
Our client was the trustee of a BVI trust established as part of long-term estate planning for a wealthy UAE businessman to provide tax-efficient arrangements for his children to inherit his properties. This particular trust was established to hold one valuable London property for the businessman’s wife and some of his children.
The claim against Virtue Trustees was brought on the basis that a UAE bank claimed that the trust had been set up as a sham to conceal the businessman’s assets and hide them from the bank. It was contended that Virtue Trustees had entered into a transaction at an undervalue when the property was settled into the trust and then subsequently sold for £8.25m. The claim in total against all the parties, the businessman, all members of his family and our client was over £19m. The Judge held that the Claimant failed to prove any of its claims against the Defendants and all claims against Virtue Trustees were dismissed, which was the only party that succeeded with an order for its costs to be paid on the indemnity basis. This was a very successful outcome for our client. This is now the leading case on claims against trustees made under s.423 of the Insolvency Act 1986.
