The founder of a Cayman Islands headquartered fund, that bankrolled ‘no win, no fee’ lawsuits, has been jailed for 14 years for using millions in investors cash to finance his own extravagant spending habits.
Axiom Legal Financing Fund founder Timothy Schools was today sentenced to 14 years in prison at a hearing at Southwark Crown Court after being found guilty on five counts of fraud and money laundering.
The former lawyer used a network of offshore trusts and bank accounts to siphon off millions invested in his litigation fund to buy £262,543 worth of luxury cars, a £78,000 motor boat, and a £5m shooting and fishing estate in the Lake District.
At a sentencing hearing today, Judge Martin Beddoe said he believed Schools had always seen Axiom as a “get rich quick scheme” which the investment manager was “prepared to behave at any turn necessary to be dishonest to secure its success.”
“You are an utterly dishonest man and that characteristic of dishonesty has regrettably run through you for a very, very long time,” the Judge Martin Beddoe told Schools.
The investment manager, who set up Axiom in 2009 with a view to financing ‘no win, no fee’ lawsuits, told investors their money would be paid out to a panel of high-quality law firms, and used to bankroll profitable legal cases.
Instead, the majority of the money was paid out to just three separate law firms – ATM, Ashton Fox and Bracewell’s – all of which were either owned or part-owned by Schools himself.
Schools paid himself a £1m annual salary whilst ploughing the £100m of investment secured by Axiom into a series of failed lawsuits – whilst using loans to cover up the losses.
The judge said Schools sought out cases, irrespective of their chances of winning, in order to “cream off” as much money as possible.
David Savage, head of financial crime at law firm Stewarts, said: “This case demonstrates that the SFO remains willing and capable of securing convictions for big ticket fraud.”
“Going forward the government needs to ensure that the SFO is provided with the funding and legislative fire power to pursue global criminality without also expending time and effort trying to justify its existence.”